Meta Agrees to $725 Million Class Action Settlement in Cambridge Analytical Scandal

CPO Magazine | Scott Ikeda | Jan 4, 2023

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The 2018 Cambridge Analytica scandal was perhaps the biggest single event to move online data privacy into mainstream conversation, and Facebook spent 2019 being fined by various government regulatory bodies over it.

  • The Cambridge Analytica scandal centered on the firm’s work for the 2016 presidential campaign of Donald Trump.
    • The company identified a loophole in the Facebook API that allowed it to access profile information and the “likes” of mass quantities of platform users that it otherwise would not have had access to.
    • A psychological profile test created by the company was taken by about 300,000 people, but those who took it were unwittingly granting the company access to the profile information and activity of their full network of platform friends as well.
    • Scandal saw Meta CEO Mark Zuckerberg brought before Congress for an intense questioning session, which culminated in a string of fines from federal agencies (and regulatory bodies in other countries). The largest individual payment was $5 billion to settle an FTC probe, a massive overpayment based on the initial proposed fine amount but one that guaranteed Zuckerberg and other executives would not face personal liability.

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  • Up to 87 million Facebook accounts had user data inappropriately accessed as the research firm leveraged a weakness in the platform’s API to harvest information that was not meant to be available to the general public.
  • Meta has agreed to pay $725 million to settle a class action suit.  Meta reportedly agreed to settle the suit in August, but terms have only recently been made available to the public.
    • As to what Facebook users can expect to receive if the settlement is approved, after attorney fees (expected to be about 25%) the remaining amount is set to be divvied up between an estimated 250 to 280 million eligible platform users. The actual amount will depend on how many of those users file claims, which could lead to each user receiving as little as a few dollars in compensation.
  • The company continues to face other privacy-related difficulties, however; it just recently reached a $90 million settlement in another case involving its use of cookies and embedded “like” buttons to track users around the web without their full knowledge.

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