A competition legal expert, backed by a powerful litigation fund, is set to file a multibillion-dollar class action lawsuit against Facebook/Meta for breaching competition law on the grounds that it abused its dominance of UK social networks for several years. If the measure succeeds, Facebook will have to pay $3.1 billion (£2.3 billion) in compensation to Facebook UK users.
The class action lawsuit against Meta, the parent company of Facebook, was filed yesterday with the UK Competition Court of Appeal in London.
The unusual approach claims that Facebook must pay 44 million UK users in compensation for the exploitation of their data between 2015 and 2019. Effectively, Facebook says it took all the personal and private data of its users – who, due to Facebook’s dominance, had no other scalable social platform For the app – and in return all its users got, in fact, the ability to post pictures of babies and kittens to their friends and family.
The action is being taken by expert in international competition law, Dr Lisa Lovedal-Joersen (pictured above) who has submitted submissions to the British Parliament regarding Facebook’s market dominance, as well as academic legal papers written on the subject.
Dr. Lovedal-Joersen’s case is based on the idea that Facebook (recently renamed Meta) set an “unfair price” for Facebook users in the UK.
The “price” set for granting access to the social network was a waiver of the high-value personal data of UK users, who in return got “free” access to Facebook’s social networking platform, without any financial compensation, all while Facebook generated billions in revenue. .
Key to the case argument is that Facebook has “trapped” its UK users by not only locking them and their data in its platform, but also by tracking them via the Facebook pixel, on other websites, thus creating a deep “social graph” data around which the users are.
German sees Dr. Lovdal-Joersen’s argument that user profiles have repeatedly resurfaced in controversies, such as the Cambridge Analytica scandal, illustrating their market exploitation.
Lawyers for Dr. Lovedal-Joersen, Quinn Emmanuel Urquhart & Sullivan, LLP, wrote to Meta to notify them of the claim. Dr Lovdahl Gormsen will represent the category of people affected – all UK residents who have used Facebook at least once during 1 October 2015 – 31 December 2019.
A collective “opt-out” action is the first of its kind against Meta in England and Wales. As an opt-out case, the 4 million Facebook users in the UK will not need to actively join the case for compensation, but will be part of the claim unless they decide to opt out.
Financial support for the case comes from the Insworth Corporation, one of the world’s largest litigation funders. Quinn Emanuel and Innsworth have a past history of filing consumer class actions of this nature.
The broader context for this is that Meta is also facing a US consumer class action lawsuit, worldwide regulatory action and an antitrust lawsuit from the US FTC that could dislodge it from the Instagram and WhatsApp platforms.
Dr. Lovedal-Joersen said in a statement: “In the 17 years since its inception, Facebook has become the only social network in the UK where you can be sure to connect with friends and family in one place. However, there has been a dark side to Facebook. It has abused its market dominance to impose terms and unfair rulings on ordinary Britons giving them the ability to exploit their personal data. I am launching this case to secure multi-billion pound damages to the 44 million Britons whose data Facebook exploited.”
While talking to me on a call, I asked Dr. Lovdahl Gormsen if Facebook could say that there are other social networks available, such as Twitter or Myspace?
“I don’t think people can connect with their family and friends in the same way on Twitter and Snapchat and all these other places. Facebook is unique in the way they do it,” she said.
The action also depends on the spread of the Facebook pixel on other websites. I asked him what the significance of this for the case?
“Imagine yourself as a Facebook user,” said Dr. Lovdahl Gormsen. “You might be aware that Facebook.com will use your data. But what the pixels do is when you use a third party website, it of course has nothing to do with Facebook. This means that Facebook has created a lot and a lot of your data points which you were You already know you signed up for it.”
She argues that although it is possible for a user to remove themselves from the Facebook platform, in the depths of the settings, in practice the vast majority of users have no idea how to do this or even know that it is possible.
Dr. Lovdal Görmsen is a Senior Research Fellow at the British Institute of International and Comparative Law (BIICL), Director of the Competition Law Forum, a non-governmental advisor to the International Competition Network and a member of the Advisory Board of Antitrust Review. Enforcement (OUP).
TechCrunch contacted Facebook to request comment but received no response at the time of publication.