Trial begins against Zuckerberg, Meta leaders over Facebook privacy violations

New Delhi: An $8 billion class action lawsuit against Meta CEO Mark Zuckerberg and current and former company leaders commenced Wednesday in Delaware Chancery Court, spotlighting allegations of privacy violations tied to the 2018 Cambridge Analytica scandal. 

The case, brought by Meta shareholders, primarily union pension funds, accused Zuckerberg and other executives of operating Facebook as an illegal enterprise that harvested user data without consent, breaching a 2012 agreement with the Federal Trade Commission (FTC).

The lawsuit stems from revelations that Cambridge Analytica, a now-defunct political consulting firm that supported Donald Trump’s 2016 presidential campaign, accessed data from millions of Facebook users without their knowledge. 

Shareholders alleged that Meta failed to disclose the risks of such misuse and continued deceptive privacy practices, violating the FTC consent order that required clear user consent before sharing personal data. The order also mandated a comprehensive privacy program, which plaintiffs claim was undermined by actions such as removing required privacy disclosures from user settings and selling data to commercial partners.

The fallout from the scandal led to a record $5.1 billion FTC fine in 2019, penalties in Europe, and a $725 million settlement with users. Shareholders now seek to hold Zuckerberg, former COO Sheryl Sandberg, and other defendants, including board members Marc Andreessen, Peter Thiel, and Reed Hastings, liable for reimbursing Meta for over $8 billion in fines and legal costs. They also allege Zuckerberg sold $5 billion in stock in 2018, anticipating a stock drop due to the scandal, though defendants claim this was part of a lawful stock-trading plan for charitable purposes.

The trial, presided over by Chancellor Kathaleen McCormick, opened with testimony from privacy expert Neil Richards, who stated, “Facebook’s privacy disclosures were misleading,” highlighting deficiencies in user notifications. In contrast, Jeffrey Zients, a former Meta board member and White House chief of staff under President Biden, testified that privacy was a priority for the board and management. Zients supported the FTC settlement to allow the company to move forward, asserting there was “no indication” Zuckerberg acted improperly.

Defendants, including Zuckerberg, deny wrongdoing, arguing that Facebook was a victim of Cambridge Analytica’s deceit and that robust privacy controls were implemented. They maintain that agreements with third-party apps, including those linked to board members like Andreessen, Thiel, and Hastings, complied with the FTC order.

The non-jury trial, expected to run through July 25, will feature testimony from Zuckerberg, Sandberg, Andreessen, and Thiel, among others. A ruling from McCormick is anticipated months after the trial concludes. Meta’s attempt to dismiss the case was rejected by the Supreme Court, which upheld an appellate decision allowing the lawsuit to proceed.