On Friday, the latest documents were filed in a court case brought against Facebook and senior executives including Mark Zuckerberg. It all stems from the Cambridge Analytica scandal, which became public in 2018 and showed how privacy breaches don’t just harm individuals, they can compromise democracy.
The Cambridge Analytica scandal, you may recall, involved Facebook giving app developers access not just to the data of users, but to the data of users’ friends. As a result, millions of people globally were targeted with highly individualised political advertising. This may have swayed the 2016 US election, and many other elections internationally. In response, the Federal Trade Commission fined Facebook a record-breaking US$5billion. Admittedly, two Commissioners dissented. They didn’t think $5billion was enough.
It seems that after the scandal broke, Facebook shareholders gained access to Board-level documents. And then they launched the Delaware lawsuit, which contains three main allegations, as summarised in a detailed Twitter thread by media strategist Jason Kint. First, Zuckerberg, Sandberg and one other executive are said to have led their company’s allegedly ‘illegal business practices’ by overriding users’ privacy settings and allowing third-party developers complete access to all user data stored on the platform. Second, the shareholders claim that the directors breached their duty of loyalty to the company by overpaying the Federal Trade Commission when they agreed to a $5billion penalty in exchange for shielding Zuckerberg from personal liability. And third, senior executives are said to have engaged in insider trading by selling Facebook shares during the relevant period for over $20billion in gains. These are merely allegations, mind you, which are based on sealed documents seen by the plaintiffs, and are rejected by Facebook.
The court case is taking place in Delaware, where Facebook is incorporated. And then on Tuesday, less than 100 miles away in Washington D.C., Apple CEO Tim Cook gave a keynote at the IAPP Global Privacy Summit 2022. There, he reiterated that privacy is a fundamental human right, adding that ‘it is one of the most essential battles of our time.’ Apple, of course, has a vested interest here. It’s trying to distinguish itself as a protector of privacy, including by allowing users to opt out of being tracked. But, as Cook explained, some policymakers are, in the name of competition, looking to force Apple to allow apps that practice ‘sideloading’ into the App Store. If that happens, Cook said, ‘data-hungry companies would be able to avoid our privacy rules, and once again track our users against their will.’
As the tussle for our data continues, there’s a lot at stake.
Sacha Molitorisz, UTS Senior lecturer and CMT research associate