Meta Faces Lawsuit over Alleged ‘Campaign to Conquer’ VR Market

The US metaverse firm reenters the courts after app developers hit the company with fresh legal battles

Meta Quest to Adopt Subscription Service
Virtual RealityLatest News

Published: October 12, 2023

Demond Cureton

Meta Platforms faces yet another lawsuit in US courts due to an allegedly anticompetitive “campaign to conquer” the virtual reality market, Reuters reported on Wednesday.

The case sees Andre Elijah Immersive Inc and Meta Platforms Technologies LLC et al face off in the US District Court of the Northern District of California.

According to interactive gaming and application firm Adre Elijah Immersive Inc, Meta Platforms and clothing and fitness firm Alo Yoga violated a contract deal for fitness programmes.

The report continued that Andre Elijah Immersive filed the complaint in a San Jose federal court against the defendants.

What’s in the Court Case?

In the details, the plaintiff stated it had designed the fitness app in collaboration with Meta Platforms and Alo Yoga, claiming it would feature the “best and most widely-recognized yoga instructors in the world.”

Additionally, the complaint stated that Meta would launch the app at the Meta Connect 2023—the tech giant’s annual conference on new product lineups and solutions.

However, Meta terminated the contract after it found Andre Elijah Immersive had been working with Apple, one of Meta’s largest competitors.

As outlined in the lawsuit, Andre Elija Immersive have accused Meta and its co-defendants have been accused of “abusive and anticompetitive behavior,” violating antitrust laws in the United States. The plaintiff is also seeking over $100 million USD in damages, in addition to several million for breaching the app contract.

According to Reuters, representatives from Meta Platforms and Alo Yoga, along with the companies’ respective attorneys, have not immediately commented on the matter.

The litigation also accused Meta of eliminating “both present and future competition,” adding Meta had become a “key player” across the VR hardware and app distribution marketplace.

The news comes after a similar lawsuit between the US Federal Trade Commission (FTC) and Meta Platforms, where the latter launched plans to acquire Within Unlimited. The current collective plaintiff stated it was a “new entrant” in the VR fitness industry and linked to a previous lawsuit against the Menlo Park-based company last year, stating Meta’s buyout plans would “dampen innovation” in the market.

Meta closed the deal in February, with a US judge stating it would not seek a preliminary injunction to block the acquisition.

Meta’s Battles in EU Courts

The news comes after a series of record-breaking penalties European regulators ordered Meta to pay. In January, the metaverse enterprise received a massive $414 million USD fine for forcing users to accept personalised adverts across its social media family of apps (FoA).

Meta’s FoA includes Facebook, Instagram, WhatsApp, and its Meta Quest product lineup.

Doing so violated the European Union’s General Data Protection Regulations (GDPR) in 2018, which bans social media firms from launching such data mining practices without user consent.

In January, the New York Times reported that Meta’s Terms of Service agreement required users to approve personalised adverts or they would not receive access to its suite of services.

EU officials also slapped Meta with a €1.2 billion fine—the world’s largest for a tech firm—for violating GDPR regulations over transatlantic data transfers.

Financial Times reported in May that Ireland’s Data Protection Commission (DPC), which oversees the EU’s GDPR, hit Meta’s Irish operations with the historic penalty.

Additionally, Brussels stated that Meta Ireland’s data flows between the EU and the US failed to “address the risks to the fundamental rights and freedoms” of internet users.

Ireland’s DPC also forced Meta Ireland to “suspend any further transfer of personal data to the US” within five months from the initial injunction and stop processing and storing EU citizens’ data in a further six months.

Nick Clegg, President of Global Affairs, Meta, slammed the move, stating he was “disappointed” that Meta had become “singled out when using the same legal mechanism as thousands of other companies looking to provide services in Europe.”

He said at the time: “This decision is flawed, unjustified and sets a dangerous precedent for the countless other companies transferring data between the EU and US.”



AdvertisingGamingImmersive CollaborationMeta QuestSportsVR Headsets

Brands mentioned in this article.


Share This Post