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Zuckerberg, Meta Execs Settle Major Privacy Lawsuit Over $8B in Alleged Damages

Zuckerberg, Meta Execs Settle Major Privacy Lawsuit Over $8B in Alleged Damages
Source: AP Photo

 

Mark Zuckerberg and a group of current and former Meta executives have reached a settlement in a major lawsuit that accused them of causing $8 billion in damage to the company by letting Facebook repeatedly violate users’ privacy.

The agreement was announced Thursday, just as the Delaware Court of Chancery was gearing up for day two of the trial. The details of the deal weren’t made public, and none of the defense attorneys addressed Judge Kathaleen McCormick before she adjourned the session. Still, she congratulated both sides on reaching a deal.

Sam Closic, the attorney for the shareholders who brought the case, said the settlement “just came together quickly.”

Billionaire tech investor Marc Andreessen, who sits on Meta’s board and was a defendant in the trial, had been scheduled to testify that day. Zuckerberg was expected to take the stand Monday, and former Chief Operating Officer Sheryl Sandberg was set for Wednesday.

The lawsuit came from Meta investors who were trying to hold 11 top execs — including Zuckerberg, Sandberg, Andreessen, and others — personally responsible for the billions Meta paid out in privacy-related fines and legal costs. The biggest hit came in 2019, when the Federal Trade Commission (FTC) fined Facebook $5 billion for violating a 2012 agreement to protect users’ data.

According to the plaintiffs, the board completely failed to ensure Meta was complying with that agreement. The lawsuit went further, accusing Zuckerberg and Sandberg of knowingly running Facebook as what was essentially “an illegal data harvesting operation.” The defendants pushed back hard on those claims, calling them “extreme,” and they denied any wrongdoing.

Meta, which rebranded from Facebook in 2021, was not named as a defendant in the suit. The company hasn’t commented publicly on the settlement, and defense attorneys haven’t responded to requests for comment.

Some outside observers are calling it a missed chance to shine a brighter light on Meta’s past.

“This settlement may bring relief to the parties involved, but it’s a missed opportunity for public accountability,” said Jason Kint, head of the trade group Digital Content Next.

The case had been poised to drag in even more big names, including Peter Thiel (co-founder of Palantir Technologies) and Reed Hastings (co-founder of Netflix), both former Facebook board members.

At the center of it all: the long-running concern that Meta’s leadership simply didn’t do enough to safeguard user privacy — especially in the wake of the Cambridge Analytica scandal, where data from millions of Facebook users was improperly accessed for political targeting in Donald Trump’s 2016 campaign. That scandal helped set the stage for the record-setting FTC fine.

An expert witness for the plaintiffs testified this week about “gaps and weaknesses” in Facebook’s privacy practices. But under cross-examination, he stopped short of saying Meta had outright violated the 2012 FTC agreement.

Meanwhile, former board member Jeffrey Zients pushed back on the idea that the company agreed to pay the $5B fine to shield Zuckerberg from personal legal trouble, saying that wasn’t part of the calculus.

Meta has said on its website that since 2019 it has invested billions into improving privacy protections.

With input from Al Jazeera

Michelle Larsen

Michelle Larsen is a 23-year-old journalist and editor for Wyoming Star. Michelle has covered a variety of topics on both local (crime, politics, environment, sports in the USA) and global issues (USA around the globe; Middle East tensions, European security and politics, Ukraine war, conflicts in Africa, etc.), shaping the narrative and ensuring the quality of published content on Wyoming Star, providing the readership with essential information to shape their opinion on what is happening. Michelle has also interviewed political experts on the matters unfolding on the US political landscape and those around the world to provide the readership with better understanding of these complex processes.