U.S District Court disables users from seeking a class-action lawsuit for damages against Facebook

U.S District Court disables users from seeking a class-action lawsuit for damages against Facebook
Written by:
Michael Harris
27th November 2019
Updated: 11th March 2020
  • U.S District Court says that the users' stolen personal information is not a cognizable injury.
  • Due to the individualized determinations required, users can't sue Facebook for damages as a group.
  • Mark Zuckerberg says that maintaining users' privacy has always been a priority for Facebook.
  • Facebook's stock has had a fairly upbeat year in the stock market so far.

September 28th, 2018 marked a dark day for Facebook as the social media giant was hit by a group of hackers who exploited a security loophole that enabled the felons to gain access to around 50 million users’ accounts. The incident was reported to be the largest of its kind in over 14 years of Facebook’s history.

29 Million Users Had Their Personal Information Compromised

As many as 29 million users were identified who had their personal information including email addresses, gender, phone numbers, religion, and histories compromised. The users had previously sued the social media network for damages. In a recent hearing, however, a federal judge, William Alsup, announced that following the privacy lapses on Facebook’s part, the users are only eligible to look for better scrutiny for the company.

The judge further added that the stolen personal information was not a cognizable injury that could instigate a class action lawsuit for damages. Citing the individualized determinations required, Alsup declared that the law doesn’t allow the users to sue the company for damages as a group.

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As per the District Court, inflicted users are eligible to sue Facebook as a group to only increase focus on employee training, implement automated security monitoring, and provide required information to the users regarding the hacking threats. Facebook had previously claimed such measures to be unnecessary, expressing its confidence that the bug behind the security breach has been fixed. The federal judge, however, rejected the claim.

Facebook Is Yet To Respond To The Court Hearing

In an event that the Court of Law had given approval for a class-action lawsuit for damages, Facebook would have been at the risk of a higher payout. Following the hearing, neither the users nor Facebook has responded with a comment. CEO Mark Zuckerberg, however, has reiterated on multiple occasions that maintaining users’ privacy has always been a top priority for Facebook as it ensures that people connect naturally and get an opportunity to express their true selves.

Sources from the stock market have reported that the share prices for Facebook Inc. refused to respond to the events of the District Court. The stock opened at around $200 on Wednesday and closed the day at around $202. Facebook’s year-to-date performance in the stock market has been largely upbeat in 2019. Shares were priced at around $135 at the start of the year. Printing a high of slightly over $204 in July, the stock is currently settling around $200. Facebook has traded well-above the opening level in 2019 so far.

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