Meta Platforms Inc., the company that owns Facebook, has agreed to pay $725 million to settle a class-action lawsuit accusing the social media behemoth of granting access to user data to outside organizations like Cambridge Analytica.
The long-running case brought on by allegations in 2018 that Facebook had permitted the British political consulting firm Cambridge Analytica to access the data of as many as 87 million users would be resolved by the proposed settlement, which was revealed in a court filing late on Thursday.
The proposed payment was described as the largest ever reached in a US data privacy class action and as the most Meta has ever paid to settle a class action complaint by the plaintiffs’ attorneys.
The principal plaintiffs’ attorneys, Derek Loeser and Lesley Weaver, stated in a joint statement that “this historic settlement will provide real relief to the class in this complicated and unusual privacy issue.”
As part of the deal, which must be approved by a federal judge in San Francisco, Meta did not admit any wrongdoing. In a statement, the business claimed that reaching a settlement was “in the best interest of our community and stockholders.”
We have changed our approach to privacy over the past three years, and we’ve put in place a thorough privacy program, according to Meta.
The now-defunct Cambridge Analytica contributed to the successful 2016 presidential campaign of former president Donald Trump and used the personal data from millions of Facebook accounts for voter profiling and marketing.
Without the users’ permission, Cambridge Analytica received the data from a researcher who was given permission by Facebook to utilize an app on its social media network to harvest data from millions of its users.
The resulting Cambridge Analytica crisis sparked legal actions, regulatory inquiries into the company’s privacy policies, and a prominent US congressional hearing when Mark Zuckerberg, the CEO of Meta, was questioned by lawmakers.
In 2019, Facebook agreed to pay $5 billion to settle a Federal Trade Commission investigation into its privacy practices and $100 million to resolve SEC charges that it misled investors about the misuse of user data.
The corporation is defending itself against a lawsuit brought by the attorney general of Washington, DC, as well as ongoing investigations by state attorneys general.
The settlement announced on Thursday addressed complaints from Facebook users that the corporation had illegally harvested their personal data on a large scale without their permission from app developers and business partners.
According to the users’ attorneys, Facebook misled people into believing they could maintain control over personal data when, in reality, it allowed thousands of predetermined outsiders access.
Facebook claimed that its users’ information shared with friends on social media is not subject to any legitimate privacy interests. However, US District Judge Vince Chhabria referred to such viewpoint as “so erroneous” and generally permitted the case to proceed in 2019.
According to a court document filed on Thursday, the settlement applies to between 250 million and 280 million Facebook users. The number of individuals who make legitimate claims for a share of the settlement will determine how much each user receives.
Plaintiffs’ attorneys say they intend to petition the judge to grant them up to $181 million in attorneys’ fees, or up to 25% of the settlement.
