Facebook parent Meta agrees to pay $725 million to settle privacy scandal

Meta has agreed to pay a whopping $725 million to settle a long-standing legal action taken against it for a data breach. In 2018, Facebook was accused of allowing third-party access to users’ personal information and data.

“We are pleased to present the Settlement to the Court for its review. Plaintiffs respectfully request that the Court preliminarily approve the $725 million nonreversionary Settlement,” the settlement statement reads. 

In 2018, Cambridge analytical, a British consulting firm, got access to the private information of Facebook users for the 2016 US presidential election. Although Meta refused to admit any wrongdoing, the company said the decision to pay for the damages was in the best interest of shareholders, and it would end the unending litigation.

“We pursued a settlement as it’s in the best interest of our community and shareholders. Over the last three years we revamped our approach to privacy and implemented a comprehensive privacy program,” Meta’s spokesperson, Dina El-Kassaby Luce, said.

Facebook had argued that it did not grant third-party access to the personal information of users. However, the decision to proceed with the settlement was described by some as a subtle admission of guilt. 

“The amount of the recovery is particularly striking given that Facebook argued that its users consented to the practices at issue, and that the class suffered no actual damages,” one lawyer said. 

Reacting to Meta’s agreement to settle, the lead counsels, Mr Derek Loeser and Lesley Weaver said: “This historic settlement will provide meaningful relief to the class in this complex and novel privacy case. We have reached this point only because our teams of lawyers and professionals have dedicated years of hard work to this case. We are also immensely thankful to the Court and the mediators.” 

The legal team has been at the top of the matter since 2018. They could get up to 25% of the money unless the judge says otherwise.

Who will receive the money?

The plaintiff’s lawyers argued before the court that about 250 million to 280 people are eligible to share the $725 million. This figure covers Facebook users in the United States in the period under investigation. The legal team could be heading home with about 25% of the total sum if the presiding judge approves their request, while whoever comes forward with valid claims would be paid as well. The amount each individual would receive depends on how many people with valid claims against Facebook.

We might have to wait until the judge approves Meta’s request to pay the money before it can be certain what happens to it.

One settlement after another

It is not the first time Meta is paying for a settlement over a privacy issue. In 2019, Facebook paid a staggering $5 billion fine to settle a dispute over privacy with the Federal Trade Commission.

After the tech company was accused of misleading investors by the Exchange Commission, it paid $100 million to the US Securities and Exchange Commission.

As Meta continues to face several legal battles, it could have to pay more to settle the various privacy issues still pending in courts in the United States and other countries.

Meta said it has redesigned its privacy policy and implemented a comprehensive privacy program to tackle the various contentious issues facing the company.