(Bloomberg) -- Facebook Inc. shares fell the most in two months after a state antitrust investigation into the social-media company widened, with dozens more states joining the probe led by New York.
Facebook dropped after the New York Attorney General Letitia James announced Tuesday that 45 states -- plus Guam and the District of Columbia -- are investigating whether the company harmed competition. Shares fell 3.3% to $183.44 at 3:13 p.m. in New York, the most since Aug. 14.
“Big Tech must account for its actions,” Louisiana Attorney General Jeff Landry, whose state joined the probe, said in a statement. “I am proud to join my Republican and Democrat colleagues in efforts to ensure tech giants can no longer hide behind complexity and complicity.”
The expansion of the investigation deepens the antitrust scrutiny into Facebook at the state and federal levels. In addition to the attorneys general, the Federal Trade Commission, the Justice Department and the House Judiciary Committee are conducting their own investigations.
Separately on Tuesday, the Justice Department’s antitrust chief, Makan Delrahim, who is probing large internet platforms as part of a broad review of competition in digital markets, said at a Wall Street Journal tech conference in California that a breakup of a tech company is “perfectly on the table” if justified by the evidence uncovered in the probe.
James, a Democrat, has said the state antitrust probe aims to find out whether Facebook’s actions endangered user data, reduced the quality of consumers’ choices or increased the price of advertising, its main source of revenue. State attorneys general led by Texas are separately investigating Alphabet Inc.’s Google for possible antitrust violations.
A Facebook spokesman said the company intends to cooperate with the state attorneys general.
“People have multiple choices for every one of the services we provide,” the company said. “We understand that if we stop innovating, people can easily leave our platform. This underscores the competition we face, not only in the U.S. but around the globe.”
On Monday, James hosted a meeting of policy experts to discuss the strengths and weaknesses of various antitrust legal theories involving Facebook, according to a person familiar with the gathering. They also reviewed Facebook’s acquisitions of Instagram and WhatsApp, as well as privacy issues and the company’s power in the digital-advertising market, the person said. The Wall Street Journal first reported the meeting.
James and a bipartisan group of state attorneys general met earlier this month with key officials at the Justice Department and the FTC to discuss the investigation. The meetings raised the prospect that the states could join the federal probes, similar to the way states collaborated with the epic U.S. antitrust case against Microsoft Corp. that started in the 1990s.
(Updates with share price in second paragraph.)
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