On Monday, Meta subsidiary and social media platform Facebook temporarily fought off a collective lawsuit valued at 3 billion pounds ($3.7 billion) over accusations that the social media behemoth exploited its monopoly to monetise the personal data of its users. However, a London tribunal gave the proposed claimants’ lawyers up to six months to “have another go” at proving any reported losses by users.
Meta Platforms Inc., the parent company of the Facebook group, has been faced with a mass action brought on behalf of around 45 million Facebook users in Britain.
Liza Lovdahl Gormsen, a legal academic who has filed the case, says “Facebook users were not properly compensated for the value of personal data they had to provide to use the platform.”
Last month, her lawyers asked the Competition Appeal Tribunal to verify the case under the UK’s collective proceedings regime – which is almost equivalent to the class action regime in the United States. Last month, Meta said the lawsuit was “entirely without merit” and should not be carried further. Its lawyers said the alleged losses ignore the “economic value” Facebook provides.
However, on Monday, the Tribunal ruled that Lovdahl Gormsen’s methodology of establishing any losses suffered by Facebook users needed “root-and-branch re-evaluation” for the case to be pursued further.
However, Judge Marcus Smith did, give Lovdahl Gormsen’s lawyers six months to “file additional evidence setting out a new and better blueprint leading to an effective trial”. Meta’s spokesperson said the company welcomed the decision and pointed to its previous statement that the lawsuit is “entirely without merit”.
A spokesperson for Lovdahl Gormsen refused to comment.
Last month, Lovdahl Gormsen’s lawyers asked the Competition Appeal Tribunal to attest the case under the UK’s collective proceedings regime – which is roughly equivalent to the class action regime in the United States.
A decision to verify collective proceedings depended on whether the tribunal decides that the individual cases can appropriately be dealt with together, rather than on their merits.
In January, Ronit Kreisberger, representing Lovdahl Gormsen, told the tribunal that “Meta’s data practices violate the prohibition on abusive conduct by dominant firms”.
“There is unquestionably a case for Meta to answer at trial,” Kreisberger argued.
But lawyers representing Meta said the lawsuit unrightfully assumes that any “excess profits” it might make is equivalent to a financial loss suffered by individual Facebook users.
This approach “takes no account whatsoever of the significant economic value of the service provided by Facebook,” Marie Demetriou said in court documents.
She said Lovdahl Gormsen’s forecast of potential claimants’ total losses – 3 billion pounds, including interest – is “at the very least wildly inflated”.
