The Supreme Court has cleared the way for a multibillion-dollar class-action lawsuit against Facebook’s parent company, Meta, over the Cambridge Analytica privacy scandal.
The lawsuit, brought by investors, accuses Meta of failing to fully disclose the risks that Facebook users’ personal data could be misused by Cambridge Analytica, a political consulting firm tied to Donald Trump’s 2016 presidential campaign. Investors claim that the lack of transparency led to two major drops in the company’s stock price in 2018, following revelations about the extent of the privacy breach.
The justices had initially agreed to hear Meta’s appeal to shut down the lawsuit but decided Friday that they should not have taken up the case. Their decision leaves in place a lower court ruling that allows the case to proceed.
Meta spokesperson Andy Stone expressed disappointment with the ruling. “The plaintiff’s claims are baseless, and we will continue to defend ourselves as this case is considered by the District Court,” Stone said in an emailed statement.
Meta has already faced financial consequences related to the Cambridge Analytica scandal, including a $5.1 billion fine and a $725 million privacy settlement with users. The scandal stemmed from Cambridge Analytica’s use of personal data from approximately 87 million Facebook users, obtained through a third-party app developer, to target U.S. voters during the 2016 election.
Cambridge Analytica had ties to Trump political strategist Steve Bannon.
The lawsuit against Meta is one of two class-action cases involving tech companies currently under consideration by the Supreme Court. The justices are also deliberating on whether to shut down a class-action suit against Nvidia.
Investors in the Nvidia case allege the company misled them about its reliance on selling computer chips for cryptocurrency mining, a volatile and speculative market.
