Facebook Asks US Supreme Court To Dismiss Fraud Suit Over Cambridge Analytica Scandal (theguardian.com) 13
An anonymous reader quotes a report from The Guardian: The US supreme court grappled on Wednesday with a bid by Meta's Facebook to scuttle a federal securities fraud lawsuit brought by shareholders who accused the social media platform of misleading them about the misuse of user data. The justices heard arguments in Facebook's appeal of a lower court's decision allowing the 2018 class action suit led by Amalgamated Bank to proceed. The suit seeks unspecified monetary damages in part to recoup the lost value of the Facebook stock held by the investors. It is one of two cases coming before them this month -- the other one involving artificial intelligence chipmaker Nvidia on 13 November -- that could lead to rulings making it harder for private litigants to hold companies to account for alleged securities fraud.
At issue is whether Facebook broke the law when it failed to detail the prior data breach in subsequent business-risk disclosures, and instead portrayed the risk of such incidents as purely hypothetical. Facebook argued in a supreme court brief that it was not required to reveal that its warned-of risk had already materialized because "a reasonable investor" would understand risk disclosures to be forward-looking statements. "When we think about these questions, we're not looking only to lies or complete false statements," the liberal justice Elena Kagan told Kannon Shanmugam, the lawyer for Facebook. "We're also looking to misleading statements or misleading omissions." The conservative justice Samuel Alito asked Shanmugam: "Isn't it the case that an evaluation of risks is always forward-looking?" "It is. And that is essentially what underlies our argument here," Shanmugam responded.
The plaintiffs accused Facebook of misleading investors in violation of the Securities Exchange Act, a 1934 federal law that requires publicly traded companies to disclose their business risks. They claimed the company unlawfully withheld information from investors about a 2015 data breach involving British political consulting firm Cambridge Analytica that affected more than 30 million Facebook users. Edward Davila, a US district judge, dismissed the lawsuit but the San Francisco-based ninth US circuit court of appeals revived it. The supreme court's ruling is expected by the end of June.
At issue is whether Facebook broke the law when it failed to detail the prior data breach in subsequent business-risk disclosures, and instead portrayed the risk of such incidents as purely hypothetical. Facebook argued in a supreme court brief that it was not required to reveal that its warned-of risk had already materialized because "a reasonable investor" would understand risk disclosures to be forward-looking statements. "When we think about these questions, we're not looking only to lies or complete false statements," the liberal justice Elena Kagan told Kannon Shanmugam, the lawyer for Facebook. "We're also looking to misleading statements or misleading omissions." The conservative justice Samuel Alito asked Shanmugam: "Isn't it the case that an evaluation of risks is always forward-looking?" "It is. And that is essentially what underlies our argument here," Shanmugam responded.
The plaintiffs accused Facebook of misleading investors in violation of the Securities Exchange Act, a 1934 federal law that requires publicly traded companies to disclose their business risks. They claimed the company unlawfully withheld information from investors about a 2015 data breach involving British political consulting firm Cambridge Analytica that affected more than 30 million Facebook users. Edward Davila, a US district judge, dismissed the lawsuit but the San Francisco-based ninth US circuit court of appeals revived it. The supreme court's ruling is expected by the end of June.
How is this a question? (Score:1)
Re: (Score:3)
A risk in the past is not a risk; it's a certainty.
Re:How is this a question? (Score:4, Insightful)
Same bullshit. Different crapper. (Score:2)
This is the same excuse Goldman Sachs used when defending itself from a lawsuit [cnn.com] wherein they were betting against the market while at the same time telling their clients to bet for the market. They said these were sophisticated investors who knew the risks and didn't have to be tol
New calculation (Score:2)
What does a SCOTUS verdict cost to buy, and what are the limits on purchases?
We know one guy takes expensive vacations, a couple of others are more difficult, being ideologically motivated.
Still, corrupt is corrupt. You can bet that the option is on Mark's radar and he's figuring out if it is the least expensive one - if he hasn't already.
Re: (Score:2)
I think how this goes now, is the plaintiff chooses a case in the system already the outcome of which will parallel the outcome they desire with their case. Then shop that to favorable courts accompanied with "gifts" that can be for whatever reason now, but they should best say it is for something else rather than influencing a decision. Repeat this until all "honest" (so quaint! I know) justices are bypassed all the way to the Supreme Court where the process culminates in gifts to them. For things not havi
So Facebook reached the Supreme Court ... (Score:1)
So Facebook reached the Supreme Court, all that remains to be done now is buy Clarence Thomas a new Winnebago, shell out some cash for a luxury vacation for Alito, send Kavanaugh a copy of some dick pics of himself from college, send Amy Coney Barrett a fragment of the boulder that sealed Jesus's empty tomb because catholics are suckers for relics then suck up to Roberts a bit and they should be fine.
The corrupted US Supreme Court? (Score:3)
They will probably sign off on the privacy rape. Rape of all kinds just became acceptable in the US.
Re: (Score:2)
What's the privacy analog of being forced to give child custody "rights" to your rapist?
"Hypothetical Risk Defense": A Dangerous Loophole? (Score:2)
This case touches on some critical issues for anyone concerned about data privacy and transparency. First, I'm worried about the precedent Facebook is trying to set by labeling known issues as 'hypothetical' risks to avoid disclosure. If the Court sides with them, it could open the door for tech companies to dodge responsibility for actual problems by simply framing them as potential risks. That kind of defense feels like a legal loophole designed to keep shareholders -- and the public -- in the dark.
Second
Re: (Score:2)
and by "open the door" you mean "fail to close the door, and then spike it open."
sure fine whatever (Score:3)
It's not like anyone was ever going to hold Mark Zuckerberg responsible for any of his terrible actions.