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While Meta faces off with antitrust regulators In the United States And in Europe, a £2.1bn+ Facebook UK class-action rival lawsuit, which takes Meta’s market dominance for granted, is moving forward after the social media giant lost a bid to have the lawsuit overturned. The lawsuit seeks compensation worth no less than $2.7 billion at current exchange rates.
Competition law expert Dr Lisa Lövdahl Gormsen has sued the parent company of Facebook, Instagram and WhatsApp over allegations that it exploited UK users’ personal data in an “unfair deal” – based on the claim that users had no choice but to send it. Meta collects and processes its information to generate advertising profit for the company due to its dominance in the social networking market.
“The group representative argues that these practices involve unfair business conditions and/or charge an unfairly high price to users,” the litigants wrote in their lawsuit. Legal notice Publication of collective claim.
The case, which was brought as a representative action by Gormsen on behalf of all Facebook users in the UK, covers 46 million users of Meta services in the country between 14 February 2016 and 6 October 2023.
The collective “opt-out” work has taken nearly three years. Gormsen originally filed the suit in January 2022, and Meta has since tried twice and failed twice to get it dismissed.
Meanwhile, the revised claim, submitted in October 2023, was revised for damages sought to between £2.1 billion and £3.1 billion (excluding interest), based on evidence provided by Professor Fiona Scott Morton. (The suit originally set damages at £2.3 billion, but the number of Meta users in the UK increased slightly from the 44 million the suit listed in January 2022.)
In the latest development, the UK Competition Appeal Court, the court that handles litigation relating to antitrust issues, has ratified the class action claim, allowing it to proceed to trial. This in turn sparked Official notice Announcement of the case, which includes instructions on how to unsubscribe if affected users choose not to participate.
UK Facebook users are automatically opted out of the class action claim – meaning they must effectively opt out if they want to be included in any potential damages or financial settlement. (Note that there are no fees or other costs for inclusion.)
The case concerns Facebook users and how their data is collected on Meta-owned products outside of Facebook as well as on third-party platforms. Meta may collect people’s information through cookies or other tracking technologies, for example, or by information provided by advertisers, data brokers or other partners it works with to target ads.
“Facebook has made an unfair deal with its users regarding the collection of data from users about their activities outside of Facebook (“Off-Facebook Data”),” the plaintiff wrote in the official notice of the case. “Facebook requires users to give up data off of Facebook as a condition of accessing the Facebook platform under a ‘take it or leave it’ offer.”
Dr. Gormsen says these practices involve an “unfair trading situation,” charging an unfairly high price for users and their information. Given Facebook’s market dominance, the claim is that users have no real alternative to using social media networks if they wish to opt out of data collection.
“I don’t think people can connect with their family and friends the same way on Twitter (now X), Snapchat and all these other places,” Dr. Gormsen told TechCrunch when the case was first filed in 2022. Completely unique in the way they do it.”
The amount of data collected on users has been at the heart of some of the most critical views of social media, spanning controversies such as the 2018 Cambridge Analytica scandal but also more recent investigations into how much data apps like TikTok can absorb. Users. This is something the suit takes advantage of as well.
“Imagine yourself as a Facebook user,” Dr. Gormsen told TechCrunch in 2022. You may be aware that your data will be used by Facebook.com. But what pixels do is when you use a third-party website, that of course has nothing to do with Facebook. This means that Facebook has created many, many data points about you that you already knew you signed up for.
Gormsen is represented by Quinn Emanuel, and the case is being funded by Ainsworth, one of the world’s largest litigation funders, which takes a percentage if the case is successful.
The lawsuit is noteworthy for several reasons.
First and foremost, it concerns the amount the plaintiffs are seeking, which is larger than some of the largest data breach fines issued to date in Europe. (On paper, the largest fine Meta has faced for data breaches in Europe to date was $1.3 billion, issued in May 2023.)
Second, it places an actual value on personal data, which some might argue is itself a controversial idea.
Third, the case, if successful, could set a precedent for how competition law is applied by individuals in their own legal actions, as well as in other class-action-style antitrust claims — an increasing number of which are being brought against tech giants. It spans different business areas, from marketplaces and app stores to cloud computing.
“This groundbreaking case promises to redefine the application of competition law in the context of data exploitation,” Kate Vernon, partner and head of Quinn Emanuel’s litigation practice, said in a statement. “It establishes a legal framework for dealing with this pivotal issue and represents a major shift in how we deal with the critical issues associated with it.”
We’ve reached out to Meta for comment and will update when we hear back.
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