News in 2018 that the data-mining firm Cambridge Analytica had taken data from up to 87 million Facebook users through a personality quiz app sparked the lawsuit. It grew to encompass several cases — which were consolidated in the U.S. District Court for the Northern District of California in 2018 — and address broader concerns about the company’s data privacy practices. Plaintiffs alleged that Facebook granted third parties access to users’ content and information without their consent and failed to monitor how it was used. Meta has denied any wrongdoing but agreed to the settlement in December to avoid the costs and risks of continuing the case.
The agreement was given a preliminary okay by a federal judge at the end of March. A final approval hearing is set for September.
In December, Keller Rohrback, one of the law firms representing the plaintiffs, called the agreement “the largest settlement ever of a privacy class action in the United States.” Meta said the settlement was “in the best interest of our community and shareholders,” and that the company has “revamped our approach to privacy.”
The settlement comes amid turbulence for the company, which faces steep competition from the video-sharing app TikTok and tightening privacy rules from Apple that limit advertisement targeting and could cost Facebook an estimated billions of dollars, according to Forbes. Meta on Wednesday is expected to announce the latest in multiple rounds of layoffs this year, which could affect thousands of highly skilled tech workers.
In the last quarter of 2022, there were 266 million monthly active Facebook users in the United States and Canada, according to company data. The number eligible for payment in the data privacy settlement includes those who resided in the United States and used the platform at any point from May 24, 2007, to Dec. 22, 2022.
Claims can be filed on the settlement website or by mail. The deadline to file a claim is Aug. 25, and the deadline to opt out or object to the settlement is July 26.
It’s hard to say exactly how much money users will receive; it will depend on a variety of factors, including legal and administrative fees, how many claims Meta receives and how long a particular user was on Facebook during the class period.
Each of the eight named plaintiffs could receive up to $15,000, and a maximum of 25 percent of the $725 million fund could also go toward legal fees, according to the settlement papers. What is left will be divided among potentially tens of millions of users.
A 2019 Federal Trade Commission study found that a median of 9 percent of consumers who were eligible filed claims in 149 class-action lawsuits.
This is not the first class-action data privacy case Facebook has faced. In 2021, an Illinois judge approved a settlement in which Facebook agreed to pay $650 million to resolve a class-action suit alleging that the company used users’ biometric data without permission. Nearly 1.6 million users were affected and eligible for at least $345 each, according to the Associated Press.
Facebook has made efforts to manage privacy on its platform in recent years, such as by allowing users more control over who can see their posts and what ads they see. A recently launched $12-a-month subscription service in the United States also promised users additional security. One critic said the move treated vulnerability as a business opportunity.