Photo credit: Dai Sugano/Bay Area News Group
Action by Silicon Valley civil prosecutor alleges that Meta facilitates scam ads on its platforms, generating an estimated $7 billion in revenues per year by exposing consumers to 15 billion scam ads daily on Facebook and Instagram
Santa Clara County Counsel Tony LoPresti filed a landmark civil prosecution against Meta Platforms, Inc. The action, which is the first brought in California and the first brought by a local civil prosecutor in the nation, alleges that Meta knowingly facilitates and profits from billions of scam advertisements on its popular Facebook and Instagram platforms that defraud seniors and families and squeeze legitimate small businesses out of fair access to consumers.
“Meta’s platforms have become a preferred hunting ground for scammers, and our lawsuit alleges that Meta not only knows it, but has put in place systems and tools to ensure it profits from it,” said LoPresti. “No corporation is above the law. As civil prosecutors in Silicon Valley, we cannot allow a tech company as powerful as Meta to continue perpetrating a worldwide scheme to deceive consumers.”
Renne Public Law Group (RPLG), is assisting in the prosecution of the complaint, filed in Santa Clara County Superior Court, which alleges that Meta is deeply aware of the scale of the problem, tracking up to 15 billion scam ads shown to users every day across its platforms and deriving an estimated $7 billion in annual “violating revenue” — Meta’s internal term for revenue resulting from fraudulent or otherwise prohibited advertisements. According to the filing, Meta’s own systems flag ads that are likely scams but, instead of stopping those ads, the company charges scammers a premium price to run them, a practice that both facilitates and monetizes deception. RPLG is joined by Bernstein Litowitz Berger & Grossmann LLP and Bishop Partnoy LLP in assisting LoPresti and his team.
“RPLG is honored, along with our other co-counsel, to support Santa Clara County Counsel Tony LoPresti and his incredible team in their effort to hold Meta accountable for its conduct. Louise Renne and Jon Holtzman, RPLG founding partners, helped pioneer in-house affirmative litigation by public agencies and social impact litigation is a big part of our firm’s history and culture,” said Partner and Head of Affirmative Litigation Practice Jim Ross. “Supporting Mr. LoPresti and his team to address Meta’s harmful actions is an extension of our mission, history and culture.”
“RPLG is a mission driven firm that advocates for public law in the public interest,” continued Jim. “Our participation in this lawsuit is an example of that mission: navigating solutions for public entities, addressing major social issues and deterring the conduct of the bad actors.”
LoPresti is asking the Court to stop Meta’s unlawful practices through injunctive relief; to require restitution for money lost as a result of Meta’s actions; and to impose civil penalties, including enhanced penalties for violations affecting senior citizens and treble remedies available under California law to deter wrongdoing against vulnerable populations.
The lawsuit argues that no company that large should be allowed to treat regulatory fines as a mere cost of doing business while Californians bear staggering financial and emotional losses.
The action is brought by the People of the State of California, acting by and through Santa Clara County Counsel Tony LoPresti, with the assistance of outside special counsel Bernstein Litowitz Berger & Grossmann LLP, Bishop Partnoy LLP and Renne Public Law Group LLP.
The case is People of the State of California, Acting By And Through County of Santa Clara County Counsel Tony LoPresti v. Meta Platforms, Inc. and Instagram, LLC and the full complaint is available here. Click here to watch the press conference.