A U.S. judge has ordered Facebook to turn over internal records regarding data privacy and access to user data.
The directive is part of an ongoing Federal Trade Commission investigation into the social network’s privacy practices.
The ruling in the state of Delaware involves an investor lawsuit seeking company records to investigate potential wrongdoing and mismanagement by Facebook directors regarding data privacy breaches.
Cambridge Analytica
The lawsuit followed reports that the data of more than 50 million Facebook users had been misappropriated without their knowledge by British political consulting firm Cambridge Analytica in 2015.
At the time of the Cambridge Analytica breach, Facebook was subject to a consent decree involving the US federal trade commission’s determination that its data privacy measures were not adequate.
The judge rejected Facebook’s argument that the plaintiffs had not stated a proper purpose for inspecting company records or demonstrated a credible basis to infer that board directors breached their duties.
Facebook must now turn over the internal records.
Data firm
Cambridge Analytica is a data firm that promises its customers insights into consumer or voter behaviour.
On the commercial side, that means tools like “audience segmentation” — breaking out advertising audiences into smaller groups — and then targeting advertisements to those groups on “multiple platforms.”
While advertisers generally target consumers as groups, political campaigns need to target specific people — registered voters receptive to a potential message.
The company website says: “Combining the precision of data analytics with the insights of behavioural psychology and the best of individually addressable advertising technology,”
Adding: “you can run a truly end-to-end campaign.”
Judge
U.S. District Judge Vince Chhabria is overseeing dozens of suits alleging users have no real control over their personal information, and that the company has repeatedly misled users to continue mining it.
The suits have a long way to go before users stand a chance of claiming billions of dollars in damages.
Chhabria isn’t addressing the merits of the complaints, only deciding whether the allegations are legally enough to proceed. The next step will be for users to seek internal information from the company to back up their claims.
Users contend intrusions on their privacy have continued despite a 2011 agreement with the FTC barring the social network from extracting personal data without their knowledge.
Facebook says that its operating costs rose to $11.7 billion in the three months ending March 31, up 80 percent from the year-earlier period.
The company set aside $3 billion to deal with the issue, it said in its quarterly earnings release, noting that the final loss from any government fines could be as much as $5 billion.
Lawsuits
The lawsuits filed in San Francisco federal court identify one practice described as particularly deceptive: extracting information from users who adjusted their privacy settings to share information with “Friends Only” by collecting it from those friends.
“Cambridge Analytica’s abuse of user content and information was neither isolated nor unusual,” according to one of the suits before the judge. “Facebook allowed tens of thousands of third-party apps to download user content and information and was wilfully indifferent to monitoring them.”
Facebook deliberately stripped the privacy settings so app developers and as many as 150 business partners — from Apple to Warner Brothers — could use data from videos, photos, comments and viewing history,
The information shared with Cambridge Analytica yielded so-called “psychographic” marketing, targeting voters, for example, with hyper-specific appeals based on users’ fears, feelings and values.
“Users were not aware, and to a large extent are still not aware, that if a friend interacts on a website with whom Facebook has an undisclosed business relationship, all of the content and information shared with that friend, even if shared with non-public settings between a few people, falls unrestricted into the hands of those companies,” according to the complaint.
