Technology

Facebook Lawsuit: Consumer Advocates Warn of Consequences

Meta Sued for Privacy Violations: Consumer Advocates Take Facebook Parent Company to Cologne Higher Regional Court.

Eulerpool News May 14, 2024, 9:01 AM

Consumer advocates have accused the Facebook parent company Meta of data protection violations and have therefore filed a lawsuit at the Higher Regional Court of Cologne. Last year, numerous Facebook and Instagram users had to decide whether they wanted to use the services with personalized advertising or pay for ad-free usage. The Consumer Center of North Rhine-Westphalia stated that this is illegal. "It is unacceptable that large companies like Meta do not comply with existing rules," emphasized Wolfgang Schuldzinski, board member of VZ-NRW.

A spokesperson from Meta rejected the allegations and claimed that they have complied with applicable laws. The subscription models were designed to give people control over their data and its use for personalized advertising. A ruling from the EU Court of Justice confirms that ad-free subscription models are a legal step to obtain consent for personalized advertising.

Consumer advocates do not see a voluntary choice in the "Pay or Consent" issue. They argue that Meta has intentionally designed the options in such a way that users are practically forced to agree to the free use. This allows Meta to perform comprehensive user tracking for personalized advertising. Furthermore, the consumer center criticizes that the ad-free subscription does not make it sufficiently clear that data would still be collected. Schuldzinski explains: "Users who do not know this believe, after concluding the subscription, in the mistaken assumption that their user behavior is not being stored."

In November, the privacy organization noyb, whose name is derived from the English expression "none of your business," filed a complaint with the Austrian data protection authority. The consumer protection center of North Rhine-Westphalia (Verbraucherzentrale NRW) also filed a separate lawsuit against Meta, concerning a mislabeled order button. In this case, the consumer protection center prevailed in provisional legal protection at the Higher Regional Court of Düsseldorf.

The Meta stock, which is listed on the NASDAQ, temporarily lost 1.63 percent and was trading at 468.46 US dollars.

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