The Supreme Court has dismissed an appeal from Meta Platforms regarding a securities fraud lawsuit tied to the Cambridge Analytica data-harvesting scandal. This dismissal allows the lawsuit to proceed in lower courts, where plaintiffs allege that Facebook misled investors about the 2015 data breach.
In 2019, British journalist Carole Cadwalladr stated, “Facebook: you were on the wrong side of history in that. And you are on the wrong side of history in this. In refusing to give us the answers that we need. And that is why I am here. To address you directly. … We are what happens to a western democracy when a hundred years of electoral laws are disrupted by technology.”
Cadwalladr added, “It’s not enough to say you’ll do better in the future. To have any hope of stopping this from happening again, we have to know the truth…what the Brexit vote demonstrates is that liberal democracy is broken, and you broke it.”
The case centers on claims that Facebook violated the Securities Exchange Act by withholding information about user data misuse. Following media reports in 2018 linking Facebook data to Donald Trump’s campaign, the company’s stock value fell significantly.
In a 2016 securities filing, Facebook acknowledged risks of improper third-party data use but framed them as hypothetical. Shareholders argue this misrepresentation led them to believe no data breach had occurred.
A Meta spokesperson stated, “The plaintiff’s claims are baseless and we will continue to defend ourselves as this case is considered by the District Court.”
The spokesperson added, “We are disappointed in the Supreme Court’s decision not to clarify this part of the law.”
Five years after the Cambridge Analytica scandal, activists David Carroll and Brittany Kaiser had reported progress in consumer data ownership rights. Carroll noted that the scandal raised awareness about data privacy threats to democracy.
Following the scandal, five U.S. states had enacted comprehensive privacy laws. California’s 2018 law allows residents to see and request deletion of their personal data from companies.
