Latest news with #shareholderlawsuit
CNA
3 days ago
- Business
- CNA
Trial begins as Meta investors, Zuckerberg square off over alleged privacy violations
WILMINGTON, Delaware :An $8 billion trial by Meta Platforms shareholders against Mark Zuckerberg and other current and former company leaders kicked off on Wednesday over claims they illegally harvested the data of Facebook users in violation of a 2012 agreement with the U.S. Federal Trade Commission. The trial started with a privacy expert for the plaintiffs, Neil Richards of Washington University Law School, who testified about Facebook's data policies. "Facebook's privacy disclosures were misleading," he told the court. Jeffrey Zients, White House chief of staff under President Joe Biden and a Meta director for two years starting in May 2018, is expected to take the stand later on Wednesday in the non-jury trial before Kathaleen McCormick, chief judge of the Delaware Chancery Court. The case will feature testimony from Zuckerberg and other billionaire defendants including former Chief Operating Officer Sheryl Sandberg, venture capitalist and board member Marc Andreessen as well as former board members Peter Thiel, Palantir Technologies co-founder, and Reed Hastings, co-founder of Netflix. A lawyer for the defendants, who have denied the allegations, declined to comment. McCormick, the judge who rescinded Elon Musk's $56 billion Tesla pay package last year, is expected to rule on liability and damages months after the trial concludes. The case began in 2018, following revelations that data from millions of Facebook users was accessed by Cambridge Analytica, a now-defunct political consulting firm that worked for Donald Trump's successful U.S. presidential campaign in 2016. The FTC fined Facebook $5 billion in the wake of the Cambridge Analytica scandal, saying the company had violated a 2012 agreement with the FTC to protect user data. Shareholders want the defendants to reimburse Meta for the FTC fine and other legal costs, which the plaintiffs estimate total more than $8 billion. In court filings, the defendants described the allegations as "extreme" and said the evidence at trial will show Facebook hired an outside consulting firm to ensure compliance with the FTC agreement and that Facebook was a victim of Cambridge Analytica's deceit. Meta, which is not a defendant, declined to comment. On its website, the company has said it has invested billions of dollars into protecting user privacy since 2019. The lawsuit is considered the first of its kind to go to trial that alleges that board members consciously failed to oversee their company. Known as a Caremark claim, such lawsuits are often described as the hardest to prove in Delaware corporate law. However, in recent years, Delaware courts have allowed a growing number of these claims to proceed. Boeing's current and former board members settled a case with similar claims in 2021 for $237.5 million, the largest ever in an alleged breach of oversight lawsuit. The Boeing directors did not admit to wrongdoing. The Meta trial comes four months after Delaware lawmakers overhauled the state's corporate law to make it harder for shareholders to challenge deals struck with controlling shareholders like Zuckerberg. The bill, which did not address Caremark claims, was drafted after the state's governor met with representatives of Meta. Most publicly traded companies are incorporated in the state, which generates more than a quarter of the state's budget revenue. Meta, which was reportedly considering leaving Delaware earlier this year, is still incorporated in the state. Andreessen Horowitz, the venture capital fund co-founded by Andreessen, said earlier this month that it was reincorporating in Nevada from Delaware and encouraged other companies to do the same. The company cited the uncertainty of the state's courts and referenced the Musk pay ruling. Andreessen is expected to testify on Thursday. In addition to privacy claims at the heart of the Meta case, plaintiffs allege that Zuckerberg anticipated that the Cambridge Analytica scandal would send the company's stock lower and sold his Facebook shares as a result, pocketing at least $1 billion.
Al Arabiya
3 days ago
- Business
- Al Arabiya
Facebook privacy practices the focus of $8 billion trial targeting Zuckerberg
An $8 billion trial by Meta Platforms shareholders against Mark Zuckerberg and other current and former company leaders kicks off on Wednesday over claims that they illegally harvested the data of Facebook users in violation of a 2012 agreement with the US Federal Trade Commission. Jeffrey Zients, White House chief of staff under President Joe Biden and a Meta director for two years starting in May 2018, is expected to be one of the first witnesses to take the stand in the non-jury trial before Kathaleen McCormick, chief judge of the Delaware Chancery Court. The case will feature testimony from Zuckerberg and other billionaire defendants including former Chief Operating Officer Sheryl Sandberg, venture capitalist and board member Marc Andreessen, and former board members Peter Thiel, Palantir Technologies co-founder, and Reed Hastings, co-founder of Netflix. A lawyer for the defendants, who have denied the allegations, declined to comment. The case began in 2018, following revelations that data from millions of Facebook users was accessed by Cambridge Analytica, a now-defunct political consulting firm that worked for Donald Trump's successful U.S. presidential campaign in 2016. The FTC fined Facebook $5 billion in the wake of the Cambridge Analytica scandal, saying the company had violated a 2012 agreement with the FTC to protect user data. Shareholders want the defendants to reimburse Meta for the FTC fine and other legal costs, which the plaintiffs estimate total more than $8 billion. In court filings, the defendants described the allegations as 'extreme' and said the evidence at trial will show Facebook hired an outside consulting firm to ensure compliance with the FTC agreement and that Facebook was a victim of Cambridge Analytica's deceit. Meta, which is not a defendant, declined to comment. On its website, the company has said it has invested billions of dollars into protecting user privacy since 2019. The lawsuit is considered the first of its kind to go to trial which alleges board members consciously failed to oversee their company. This is often described as the hardest claim to prove in Delaware corporate law. Boeing's current and former board members settled a case with similar claims in 2021 for $237.5 million, the largest ever in an alleged breach of oversight lawsuit. The Boeing directors did not admit to wrongdoing. In addition to privacy claims at the heart of the Meta case, plaintiffs allege that Zuckerberg anticipated that the Cambridge Analytica scandal would send the company's stock lower and sold his Facebook shares as a result, pocketing at least $1 billion. Defendants said evidence will show that Zuckerberg did not trade on inside information and that he used a stock-trading plan that removes his control over sales and is designed to guard against insider trading. McCormick is expected to rule on liability and damages months after the trial concludes.
Yahoo
3 days ago
- Business
- Yahoo
Facebook privacy practices the focus of $8 billion trial targeting Zuckerberg
By Tom Hals WILMINGTON, Delaware (Reuters) -An $8 billion trial by Meta Platforms shareholders against Mark Zuckerberg and other current and former company leaders kicks off on Wednesday over claims that they illegally harvested the data of Facebook users in violation of a 2012 agreement with the U.S. Federal Trade Commission. Jeffrey Zients, White House chief of staff under President Joe Biden and a Meta director for two years starting in May 2018, is expected to be one of the first witnesses to take the stand in the non-jury trial before Kathaleen McCormick, chief judge of the Delaware Chancery Court. The case will feature testimony from Zuckerberg and other billionaire defendants including former Chief Operating Officer Sheryl Sandberg, venture capitalist and board member Marc Andreessen, and former board members Peter Thiel, Palantir Technologies co-founder, and Reed Hastings, co-founder of Netflix. A lawyer for the defendants, who have denied the allegations, declined to comment. The case began in 2018, following revelations that data from millions of Facebook users was accessed by Cambridge Analytica, a now-defunct political consulting firm that worked for Donald Trump's successful U.S. presidential campaign in 2016. The FTC fined Facebook $5 billion in the wake of the Cambridge Analytica scandal, saying the company had violated a 2012 agreement with the FTC to protect user data. Shareholders want the defendants to reimburse Meta for the FTC fine and other legal costs, which the plaintiffs estimate total more than $8 billion. In court filings, the defendants described the allegations as "extreme" and said the evidence at trial will show Facebook hired an outside consulting firm to ensure compliance with the FTC agreement and that Facebook was a victim of Cambridge Analytica's deceit. Meta, which is not a defendant, declined to comment. On its website, the company has said it has invested billions of dollars into protecting user privacy since 2019. The lawsuit is considered the first of its kind to go to trial which alleges board members consciously failed to oversee their company. This is often described as the hardest claim to prove in Delaware corporate law. Boeing's current and former board members settled a case with similar claims in 2021 for $237.5 million, the largest ever in an alleged breach of oversight lawsuit. The Boeing directors did not admit to wrongdoing. In addition to privacy claims at the heart of the Meta case, plaintiffs allege that Zuckerberg anticipated that the Cambridge Analytica scandal would send the company's stock lower and sold his Facebook shares as a result, pocketing at least $1 billion. Defendants said evidence will show that Zuckerberg did not trade on inside information and that he used a stock-trading plan that removes his control over sales and is designed to guard against insider trading. McCormick is expected to rule on liability and damages months after the trial concludes. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNA
3 days ago
- Business
- CNA
Facebook privacy practices the focus of $8 billion trial targeting Zuckerberg
WILMINGTON, Delaware :An $8 billion trial by Meta Platforms shareholders against Mark Zuckerberg and other current and former company leaders kicks off on Wednesday over claims that they illegally harvested the data of Facebook users in violation of a 2012 agreement with the U.S. Federal Trade Commission. Jeffrey Zients, White House chief of staff under President Joe Biden and a Meta director for two years starting in May 2018, is expected to be one of the first witnesses to take the stand in the non-jury trial before Kathaleen McCormick, chief judge of the Delaware Chancery Court. The case will feature testimony from Zuckerberg and other billionaire defendants including former Chief Operating Officer Sheryl Sandberg, venture capitalist and board member Marc Andreessen, and former board members Peter Thiel, Palantir Technologies co-founder, and Reed Hastings, co-founder of Netflix. A lawyer for the defendants, who have denied the allegations, declined to comment. The case began in 2018, following revelations that data from millions of Facebook users was accessed by Cambridge Analytica, a now-defunct political consulting firm that worked for Donald Trump's successful U.S. presidential campaign in 2016. The FTC fined Facebook $5 billion in the wake of the Cambridge Analytica scandal, saying the company had violated a 2012 agreement with the FTC to protect user data. Shareholders want the defendants to reimburse Meta for the FTC fine and other legal costs, which the plaintiffs estimate total more than $8 billion. In court filings, the defendants described the allegations as "extreme" and said the evidence at trial will show Facebook hired an outside consulting firm to ensure compliance with the FTC agreement and that Facebook was a victim of Cambridge Analytica's deceit. Meta, which is not a defendant, declined to comment. On its website, the company has said it has invested billions of dollars into protecting user privacy since 2019. The lawsuit is considered the first of its kind to go to trial which alleges board members consciously failed to oversee their company. This is often described as the hardest claim to prove in Delaware corporate law. Boeing's current and former board members settled a case with similar claims in 2021 for $237.5 million, the largest ever in an alleged breach of oversight lawsuit. The Boeing directors did not admit to wrongdoing. In addition to privacy claims at the heart of the Meta case, plaintiffs allege that Zuckerberg anticipated that the Cambridge Analytica scandal would send the company's stock lower and sold his Facebook shares as a result, pocketing at least $1 billion. Defendants said evidence will show that Zuckerberg did not trade on inside information and that he used a stock-trading plan that removes his control over sales and is designed to guard against insider trading. McCormick is expected to rule on liability and damages months after the trial concludes.
Phone Arena
02-06-2025
- Business
- Phone Arena
Google settles a major antitrust lawsuit – but it's not the one making headlines
While all eyes are on Google's high-stakes legal battle with the U.S. Department of Justice over its alleged search monopoly, the company just quietly resolved a different, yet equally significant, legal headache. Today, Google's parent company agreed to a $500 million compliance overhaul to settle a shareholder lawsuit accusing the company of failing to prevent antitrust violations. The case, filed on behalf of the company by investors, targeted top executives including CEO Sundar Pichai and co-founders Larry Page and Sergey Brin. Unlike the DOJ's broader attempt to potentially break up Google's search business, this lawsuit focused on internal governance failures. Shareholders alleged that Alphabet's leadership ignored growing antitrust risks tied to its core businesses, including Search, Ad Tech, Android, and app distribution. They claimed the company's board failed to act on red flags, exposing Alphabet to regulatory consequences that might have been avoided with stronger part of the settlement, Alphabet has committed to major structural changes. The company will establish a standalone risk and compliance committee at the board level, separate from its audit group. A new senior vice president role will be created to oversee compliance, reporting directly to Pichai. Additionally, a compliance committee made up of product managers and internal experts will be embedded within Google's teams to monitor and address regulatory issues. These reforms must remain in place for at least four years. — Google spokesperson, June 2nd, 2025 Despite denying any wrongdoing, Google said it was 'happy to make these commitments' in order to avoid prolonged litigation. Shareholders will not receive direct compensation, but their legal team is expected to seek up to $80 million in attorney fees, in addition to the $500 million Alphabet has agreed to spend on compliance efforts over the next is important to note that this settlement does not mark the end of Google's legal troubles. Just hours after the deal was disclosed, Judge Amit Mehta wrapped up hearings in the DOJ's major antitrust case, which could result in drastic remedies such as forcing Google to divest Chrome or share search data with competitors. A ruling is expected by August. From my perspective, 2025 is shaping up to be one of the most challenging years yet for Big Tech. Google and Apple are under increasing pressure as regulators around the world push back against their dominance. This settlement may signal Alphabet's willingness to evolve, but it also highlights the mounting scrutiny tech giants continue to face.
