Resolved Case

Facebook Agrees To Pay $90 Million To Settle Decade-Long Data Privacy Class Action Involving Secret Internet Tracking

DiCello Levitt Secures Historic Settlement in Twelve-Year Data Privacy Class Action Against Facebook

In November 2022, DiCello Levitt and its co-lead counsel won final approval of a $90 million settlement with Meta Platforms, Facebook’s parent company, resolving a long-running class action accusing Facebook of tracking its users’ activities on third-party websites—even while they were logged off the Facebook platform. In addition to the monetary component of the settlement, Facebook agreed to sequester and delete the data that plaintiffs contended was improperly collected—an unprecedented injunction in a nationwide data privacy class action. The landmark agreement—granted final approval in the U.S. District Court for the Northern District of California and subsequently affirmed by the U.S. Court of Appeals for the Ninth Circuit—represents one of the ten largest data privacy class action settlements in U.S. history.

In this case, filed shortly after Facebook admitted in late 2011 to post-logout tracking, DiCello Levitt and co-counsel grounded Facebook users’ claims in novel theories of privacy law, arguing that these plaintiffs had standing to pursue economic damages for the misappropriation of personal data. The theories were also informed by extensive discovery. After the district court dismissed the case, the U.S. Court of Appeals for the Ninth Circuit reversed in a precedent-setting opinion that adopted the very theories that our team successfully advocated.

After Facebook’s request for review by the U.S. Supreme Court was denied and the case was returned to the district court, DiCello Levitt and its co-counsel secured an agreement with Facebook that included the $90 million settlement fund, no part of which will revert to Facebook, and the injunctive relief requiring Facebook to sequester and delete all of the data that was wrongfully collected. “They’ll be required to destroy it, and that’s significant,” U.S. District Judge Edward J. Davila said during an October hearing in the case, according to the hearing transcript. “That in and of itself is hopefully a game changer for the industry.”

Three objectors appealed the district court’s ruling. But in a unanimous summary opinion issued on February 21, 2024, the Ninth Circuit affirmed. Importantly, the Ninth Circuit held that the district court properly evaluated the monetary relief in the context of constitutionally permissible recoveries informed by a due process analysis. The Ninth Circuit also rejected the objectors’ arguments regarding sealing and also found that class notice met all Rule 23 standards.

Even before the settlement, the case had already created significant precedent favoring consumers in future data privacy actions. The 2020 Ninth Circuit opinion held that the unlawful copying and monetization of personal data creates “economic harm,” even if the value of the data in plaintiffs’ hands does not diminish as a result. The finding of economic harm is vital to plaintiffs seeking monetary damages. Lower federal courts had been split on the critical issue, with some requiring a showing that the value of the data in question diminished. The Ninth Circuit also ruled that Facebook was not a party to the communications it allegedly intercepted for purposes of the Wiretap Act, meaning that its collection of electronic communications required actual user consent.

The monetary settlement and innovative injunctive relief—hailed by the press as groundbreaking and even by defense firms as a “watershed moment” in data privacy and “a significant new development in class action law”—set a new standard for non-monetary relief in data privacy class actions of this kind, potentially deterring similar data collection tactics and increasing consumer privacy.

David Straite led the DiCello Levitt team that also included Amy Keller and Adam Prom.