The parent company of Facebook has agreed to pay $725 million to resolve a class-action lawsuit.
The deal follows nearly four months after news first broke that Meta had proposed a settlement in the Northern District of California where the suit was first filed. In the intervening years, Meta has pushed back against the lawsuit, which consolidated complaints from multiple Facebook users, arguing that those who signed up to the social network should have no expectation of privacy.
One of many scandals to hit the world of Facebook has to do with Cambridge Analytica, a U.K.-based political consulting firm that used data from tens of millions of Facebook users to influence voters. The privacy brouhaha that followed led to various fines and settlements, with Meta paying $5 billion as part of a deal with the Federal Trade Commission.
The class-action lawsuit was expanded to include other third-parties that may have used Facebook user data.
The upper echelon at Meta have not had to face any more direct questioning on the matter after Mark Zuckerberg testified in front of the EU Parliament about the scandal. With the upcoming lawsuit, Facebook founder and CEO Mark Zuckerberg, as well as his predecessors, were all set to testify at an upcoming hearing. This is something that Meta didn't want, and it won't happen now that a tentative settlement has been reached.
The biggest recovery ever achieved in a data privacy class-action and the most Facebook has ever paid was the result of the proposed settlement.
The people wrote.
The amount of the recovery is particularly striking given that Facebook argued that its users consented to the practices at issue, and that the class suffered no actual damages. Plaintiffs dispute these characterizations, but acknowledge that they faced tremendous risks in this novel and complex case. In addition to the monetary relief obtained by Plaintiffs, Facebook has meaningfully changed the practices that gave rise to Plaintiffs’ allegations, as set forth in the declarations of two Facebook employees with knowledge of those facts.
Meta said in a statement that the settlement was in the best interest of the company and its shareholders. The settlement only applies to Facebook users in the U.S.
At a follow-on hearing on March 2, 2023, the settlement will be rubber stamped.
Washington, D.C. has filed a lawsuit against Zuckerberg, accusing him of being personally responsible for the failures that led to the scandal.
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