Wed, 03/21/2018 - 13:50
After shaving more than $20 off its share price earlier this week, Facebook stock moved back into the green Wednesday as CEO Mark Zuckerberg said he would publicly address the company's relationship with Cambridge Analytica some time during the next 24 hours.
At the same time, another lawsuit has been brought against the company, the second since the New York Times and the Observer reported over the weekend that the company had failed to stop CA from using data improperly gathered from tens of millions of users, a Maryland woman sued Facebook Tuesday in a San Jose, Calif. court. Her suit was filed on behalf of other Facebook users whose data were accessed by CA without their explicit permission, Bloomberg reported.
Circling back to Zuckerberg, the company's founder and longtime CEO attributed the delay in making a statement to his desire to say something "meaningful" rather than delivering a quick, boilerplate comment, Axios reported.
On Tuesday, a group of Facebook investors filed a lawsuit against the company in a San Francisco federal court. The class action claims investors had suffered losses after the company disclosed that it had severed ties with Cambridge Analytica after blaming the company for "misleading" Facebook by saying it had deleted a cache of user data, when Facebook says it actually kept the data. CA has denied the allegations and said it didn't use Facebook data for its work on the 2016 Trump campaign. Investors who purchased shares of Facebook between Feb. 3, when it filed its annual report and cited security breaches and improper access to user data, and March 19, the Monday after the exposes were published, are eligible to join the lawsuit.
Throughout that period, “defendants made false or misleading statements and failed to disclose that Facebook violated its own data privacy policies by allowing third parties access to personal data of millions of Facebook users without their consent,” according to the complaint.
As Bloomberg explains, investors would have a strong case if they can prove that they invested in Facebook based on false or misleading information released by the company. By not policing app developers' use of its users data, it could be argued that Facebook misled investors about how it handled and safeguarded private user data.
Massachusetts Attorney General Maura Healey has opened a civil probe into the company and Connecticut AG George Jepsen has sent a written inquiry to answer questions about Cambridge Analytica. The Federal Trade Commission has also opened a data-privacy investigation into the company.
European Union Justice Commissioner Vera Jourova plans to meet with Facebook officials in Washington on March 21. She called the data misuse "horrifying, if confirmed" and "not acceptable."
Four days after the allegations first surfaced, #DeleteFacebook started trending on Twitter late Tuesday as users complained about "trust issues" regarding how the company shares their personal data. It gained a notable booster when WhatsApp co-founder Brian Acton tweeted that the time has come for Facebook users to delete their accounts.
"Delete and forget. It's time to care about privacy," he tweeted.
After senior Facebook executives like Mark Zuckerberg and Sheryl Sandberg avoided appearing before Congress late last year during a series of Congressional hearings about Russia's purported "interference" in the 2016 election.
It is time. #deletefacebook— Brian Acton (@brianacton) March 20, 2018
Politico reported that, while the company is sending lower-level staffers to brief six Congressional committees about how the data ended up in the hands of Cambridge Analytica. Meetings between Facebook staff and lawmakers were postponed to Thursday due to an intense snow storm hammering the Atlantic coast. Some Republicans have even joined their Democratic colleagues in calling for Zuckerberg to attend a hearing in person as public outrage over the scandal grows.
"Eventually, Mark Zuckerberg needs to testify; he needs to be subpoenaed if he won’t do it voluntarily," said Sen. Richard Blumenthal (D-Conn.), who had urged the FTC to investigate the affair. "They can begin with some staff people, but it’s only the beginning."
Having Zuckerberg testify would be “helpful,” said Senate Majority Whip John Cornyn (R-Texas), adding: “We need to understand how they use the data that they mine from users, their personal information. … This is a growing problem, whether it’s people like political consulting firms using it, or foreign governments using it.”
Christopher Wylie, the whistleblower who shared details of Cambridge Analytica's alleged misuse of the Facebook data with the media (and then had his Facebook page deleted), will meet with Intelligence Committee Democrats to discuss the situation