A competition law expert, backed by a powerful litigation fund, is poised to mount a multi-billion class action lawsuit against Facebook/Meta for breach of competition law, alleging that it abused its UK social media dominance for several years. If successful, the suit will see Facebook have to pay $3.1 billion (£2.3 billion) in damages to Facebook users in the UK.
The class action was filed against Meta, Facebook’s parent company, yesterday in the UK Competition Appeals Court in London.
The unusual approach claims that Facebook should pay its 44 million UK users compensation for the exploitation of their data between 2015 and 2019. due to Facebook’s dominance, they had no other viable social platform – and in return, all of their users were, in effect, given the ability to post pictures of babies and kittens to their friends and family.
The suit is being mounted by international competition law expert Dr Liza Lovdahl Gormsen (pictured above), who has made presentations before the UK Parliament on Facebook’s dominance of the market, as well as writing academic legal articles about this.
Dr Lovdahl Gormsen’s case is based on the idea that Facebook (recently renamed Meta) has set an “unfair price” for Facebook users in the UK.
The “price” set for granting access to the social network was the delivery of the highly valuable personal data of UK users, who in return simply gained “free” access to Facebook’s social networking platform without financial compensation, while Facebook generated billion in revenue.
The key to the case’s argument is that Facebook has “surrounded” its UK users not only by blocking them and their data on its platform, but also by tracking them through the Facebook pixel on other websites, thereby generating data.” Deep Social Graphics” about your Commercial.
Germain, for Dr. Lovdahl Gormsen’s argument, is that user profiles resurface several times in controversy, such as during the Cambridge Analytica scandal, further illustrating their market exploitation.
Dr. Lovdahl Gormsen’s attorneys, Quinn Emanuel Urquhart & Sullivan, LLP, wrote to Meta to notify them of the claim. Lovdahl Gormsen will represent the class of people affected – that is, all people domiciled in the UK who used Facebook at least once between 1 October 2015 and 31 December 2019.
The “opt-out” class action is the first of its kind against Meta in England and Wales. As an exclusion case, Facebook’s 4 million UK users will not need to actively participate in the case to seek damages, but will be part of the claim unless they choose to opt out.
Financial support for the case comes from Innsworth, one of the world’s largest litigation funders. Quinn Emanuel and Innsworth have a prior history of consumer class actions of this type.
The broader context for this is that Meta is also facing a US consumer class action, worldwide regulatory action and an FTC antitrust lawsuit in the US that could separate it from the Instagram and WhatsApp platforms.
In a statement, Dr Lovdahl Gormsen said: “In the 17 years since it was created, Facebook has become the only social network in the UK where you can be sure to connect with friends and family in one place. However, there was a dark side to Facebook; abused its market dominance to impose unfair terms and conditions on ordinary Brits, giving it the power to exploit their personal data. I am launching this case to secure billions of pounds in damages for the 44 million Britons who have had their data exploited by Facebook.”
Speaking to me on the phone, I asked Dr. Lovdahl Gormsen if Facebook could argue that there were other social networks available, like Twitter or Myspace?
“I don’t think people can connect with their family and friends in the same way on Twitter and Snapchat and all these other places. Facebook is quite unique in the way it is doing this,” she said.
The action is also based on the ubiquity of the Facebook pixel on other websites. What does that mean for the case, I asked?
“Imagine yourself as a Facebook user,” said Lovdahl Gormsen. “You may be aware that your data will be used by Facebook.com. But what pixels are doing is when you use a third-party website, which obviously has nothing to do with Facebook. That means Facebook created many, many, many other data points about you that you actually knew you signed up for.”
She argues that while it is possible for a user to log out of the Facebook platform, deep inside the Settings, in practice the vast majority of users have no idea how to do this or even know that it is possible.
Lovdahl Gormsen is a Senior Research Fellow at the British Institute of International and Comparative Law (BIICL), Director of the Competition Law Forum, a non-governmental advisor to the International Competition Network and on the advisory board of the Journal of Antitrust Enforcement (OUP).
Ploonge reached out to Facebook asking for comments, but received no response at the time of publishing.