A federal judge in California has sanctioned Meta for destroying or allowing the disappearance of evidence in its legal dispute with Australian billionaire Andrew Forrest. The mining magnate accuses Facebook's parent company of allowing fraudulent advertisements to circulate on its platforms, using his identity and image to promote bogus cryptocurrency investments. These ads allegedly misled internet users into believing he personally endorsed the investments.
The issue of data retention is crucial for the plaintiff. Andrew Forrest seeks to demonstrate that Meta does not merely passively host ads created by third parties, but actively participates in their presentation, modification, and distribution to users. Such a demonstration could weaken the group's defense, which relies on Section 230 of a 1996 US law. This provision generally protects platforms from lawsuits related to user-generated content.
The judge cites "serious negligence".
In his ruling, Judge P. Casey Pitts found that Meta had destroyed important data and that this loss had harmed Andrew Forrest. The company claimed it took two years to discover the existence of this information on its own systems. The judge deemed this explanation "simply not credible." Meta also maintained that it had not retained the advertisements in their final form, as they were assembled directly on users' devices.
The judge rejected this argument, relying in particular on the statements of a company engineer. According to this evidence, Meta had the technical means to preserve the data in question but chose not to. However, the court did not conclude that the destruction was intentional and aimed at harming the plaintiff. It upheld the charge of "gross negligence." If the case goes to trial, a jury will have to determine the company's liability.
Platform immunity challenged again
Meta can still request that the case be dismissed, arguing that Section 230 continues to protect him. This legal question will be decided by the judge before a potential jury trial. The stakes go beyond Andrew Forrest's case alone: US courts must determine whether platforms can invoke their status as hosting providers when they use their own systems to select, transform, or recommend fraudulent content.
This case adds to several recent legal setbacks for Meta. US courts have already ruled that Section 230 does not necessarily protect the company when lawsuits target the design of Instagram or the recommendation mechanisms of its platforms. Furthermore, a new trial is set to begin in Oakland, where four states are seeking up to $1.4 trillion in damages from the company for allegedly endangering minors.
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