An $8 billion class-action lawsuit against Meta CEO Mark Zuckerberg and other current and former company leaders is set to begin Wednesday. The lawsuit arises from the 2018 Cambridge Analytica privacy scandal.
Investors claim Meta failed to fully disclose the risks that Facebook users’ personal data could be misused by Cambridge Analytica, a political consulting firm that supported Donald Trump’s 2016 presidential campaign. Shareholders argue that Facebook repeatedly violated a 2012 consent order with the Federal Trade Commission (FTC), which required the company to stop collecting and sharing user data without consent.
The lawsuit alleges that Facebook sold user information to commercial partners despite the consent order and removed required privacy disclosures from its settings. As a result, Facebook paid a $5.1 billion penalty to settle FTC charges, faced substantial fines in Europe, and reached a $725 million privacy settlement with users. Now, shareholders are seeking reimbursement from Zuckerberg and others for Meta’s FTC fine and related legal costs, which they estimate exceed $8 billion.
The trial opened Monday with testimony from privacy expert Neil Richards, who stated that Facebook’s privacy disclosures were misleading. Although Richards did not confirm whether Facebook violated the 2012 consent order, he criticized a 2015 PricewaterhouseCoopers report that deemed Facebook’s privacy controls adequate, calling such audits “of limited value” because they rely on information provided by the company itself.
The eight-day trial will include testimonies from Zuckerberg and former Chief Operating Officer Sheryl Sandberg, as well as board members Marc Andreessen and former board member Peter Thiel. The case is being heard in Delaware Chancery Court, where Meta Platforms Inc. is incorporated. A ruling is expected several months after the trial concludes.
Meta previously sought to have the case dismissed by taking it to the Supreme Court. However, justices declined to hear the appeal, leaving in place a lower court ruling that allowed the lawsuit to proceed.
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