Meta agrees to pay $725 million to settle lawsuit over Cambridge Analytica data leak

By Clare Duffy, CNN

New York CNN  —  Facebook parent company Meta has agreed to pay $725 million to settle a longstanding class action lawsuit accusing it of allowing Cambridge Analytica and other third parties to access private user information and misleading users about its privacy practices.

The proposed settlement would end the legal battle that began four years ago, shortly after the company disclosed that the private information of as many as 87 million Facebook users was obtained by Cambridge Analytica, a data analytics firm that worked with the Trump campaign. The data leak sparked an intense international scandal for Facebook, drawing the scrutiny of regulators on both sides of the Atlantic.

The lawsuit involved obtaining millions of pages of documents from Facebook and other related parties and hundreds of hours of depositions, including dozens of current and former Facebook employees.

The users settling with Facebook called the agreement the “largest recovery ever achieved in a data privacy class action and the most Facebook has ever paid to resolve a private class action” in a motion to approve the settlement filed Thursday. They estimated that between 250 and 280 million people may be eligible for payments as part of the class action settlement.

The settlement is pending approval from a judge, who will hear the motion in March.

“We pursued a settlement as it’s in the best interest of our community and shareholders,” Meta spokesperson Dina Luce said in a statement. “Over the last three years we revamped our approach to privacy and implemented a comprehensive privacy program. We look forward to continuing to build services people love and trust with privacy at the forefront.”

Meta did not admit wrongdoing as part of the settlement. In the motion to approve the settlement, the users who brought the suit pointed to changes Facebook has made in the wake of the Cambridge Analytica breach, including restricting third-party access to user data and improving communications to users about how their data is collected and shared.

The Cambridge Analytica leak began with a psychology professor who harvested data on millions of Facebook users through an app offering a personality test, then gave it to a service promising to use vague and sophisticated techniques to influence voters during a high-stakes election where the winning presidential candidate won narrowly in several key states.

A 2020 report by the UK Information Commissioner’s Office later cast significant doubt on Cambridge Analytica’s capabilities, suggesting many of them had been exaggerated. But the improper sharing of Facebook data triggered a cascade of events that has culminated in investigations and lawsuits.

The scandal prompted a global outcry that led to hearings, an apology tour from Zuckerberg and various changes to the platform. Facebook agreed in 2019 to a $5 billion privacy settlement with the US Federal Trade Commission over the privacy breach, and to a $100 million settlement with the US Securities and Exchange Commission over claims that it misled investors about the risks of misuse of user data.

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