Meta investors and Zuckerberg agree to settle $8bn lawsuit over Facebook privacy

Investors blamed Meta leadership for data privacy failures that resulted in billions in fines, including a $5 bn US regulatory penalty

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New Delhi: Meta chief executive Mark Zuckerberg has agreed to settle a multibillion-dollar lawsuit brought by shareholders over the company’s handling of repeated Facebook privacy violations, BBC News has reported.

As per the report, The shareholders had sought more than $8 billion in damages, arguing that the company incurred significant legal costs and fines including a $5 billion penalty from the US Federal Trade Commission due to what they described as leadership failures on data privacy.

The lawsuit, originally filed in 2018, accused top executives and board members, including Zuckerberg, of allowing user data mishandling that led to the Cambridge Analytica scandal.

The case was set to continue in a Delaware court this week, but the settlement was announced just before the trial was to enter its second day, according to a lawyer representing the shareholders. Meta declined to comment on the development.

The suit named 11 defendants, including Zuckerberg, Peter Thiel (co-founder of Palantir Technologies), Reed Hastings (co-founder of Netflix), and Jeffrey Zients, who served as a Meta board director starting in May 2018 and was later White House chief of staff under President Joe Biden.

In testimony given on the opening day of the trial, Zients said the $5 billion FTC settlement was substantial but denied that it was paid to shield Zuckerberg from personal liability.

The settlement means the defendants will not have to testify under oath. Former Meta COO Sheryl Sandberg had also been expected to take the stand.

Although Meta was not a direct party to the case, the company has previously stated that it has invested billions of dollars in privacy reforms since 2019.

Chancellor Kathaleen McCormick of the Delaware Court of Chancery had been scheduled to hear testimony through the week before issuing a ruling. McCormick is the same judge who rejected Elon Musk’s $56 billion pay package at Tesla, prompting the company to reincorporate in Texas.

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