The Supreme Court will consider Meta’s request to halt a class action lawsuit filed by investors against the company in connection with the Cambridge Analytica data privacy scandal, the court announced on Monday.
The lawsuit centers on investors’ allegations that Facebook’s parent company failed to disclose how Facebook users’ personal information was being misused by Cambridge Analytica, a company that helped former President Trump’s 2016 presidential campaign.
Investors argue that Mehta’s handling of the scandal contributed to the company’s share price decline.
The Supreme Court will review a lower court decision that allowed the case to proceed.
Separate from this case, Meta has already paid a $5.1 billion fine to federal regulators and reached a $725 million privacy settlement with users based on the same Cambridge Analytica data breach.
The 9th Circuit Court of Appeals allowed the case to proceed, but Mehta, in seeking Supreme Court review, argued that the lower court’s “holdings reflect erroneous conceptions of the nature of the deceptiveness and risk and are contrary to Congress’ efforts to curb private securities litigation.”
But investors argued in response to Meta’s bid that the lawsuit “misinterpreted the Ninth Circuit’s decision” and was “not inconsistent with any decision” of the Supreme Court or any other circuit court of appeals, so there was no need for a review.
The outcome of this review could have an impact on rules regarding corporate disclosure.
