Meta agrees to pay $725 million to settle Cambridge Analytica data leak lawsuit | CNN Business

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Facebook’s parent company Meta has agreed to pay $725 million to settle a long-running class action lawsuit that accused it of allowing Cambridge Analytica and other third parties to access private user information and mislead users about its privacy practices.

The proposed settlement would end the legal battle that began four years ago, shortly after the company revealed that the private information of up to 87 million Facebook users was obtained by Cambridge Analytica, a data analytics firm that worked with the Trump campaign. The data leak sparked an intense international scandal for Facebook, prompting scrutiny from regulators on both sides of the Atlantic.

The lawsuit involved obtaining millions of pages of documents from Facebook and other related parties and hundreds of hours of testimony, including from dozens of current and former Facebook employees.

Users who settled with Facebook called the settlement “the largest recovery ever in a data privacy class action and the most Facebook has ever paid to settle a private class action” in a motion to approve the settlement filed Thursday. They estimated that 250 million to 280 million people may be eligible for payments as part of the class action settlement.

The settlement is pending approval by a judge, who will hear the motion in March.

“We sought a settlement as it is in the best interest of our community and shareholders,” Meta spokeswoman Dina Luce said in a statement. “Over the past three years we’ve revamped our approach to privacy and implemented a comprehensive privacy program. We look forward to continuing to build services that people love and trust with privacy at the forefront.”

Meta did not admit wrongdoing as part of the deal. In the motion to approve the settlement, the users who filed the lawsuit pointed to changes Facebook has made in the wake of the Cambridge Analytica breach, including restricting third-party access to user data and improving of communications to users about how their data is collected and shared.

The Cambridge Analytica leak began with a psychology professor who collected data from millions of Facebook users through an app that offered a personality test, then gave it to a service that promised to use vague techniques and sophisticated to sway voters during a high-stakes election in which the winning presidential candidate narrowly won several key states.

A 2020 report by the UK’s Information Commissioner’s Office later cast significant doubt on Cambridge Analytica’s capabilities, suggesting that many of them had been exaggerated. But Facebook’s improper data sharing set off a cascade of events that has culminated in investigations and lawsuits.

The scandal sparked a global outcry that led to hearings, an apology tour by Zuckerberg, and several changes to the platform. Facebook in 2019 agreed to a $5 billion privacy settlement with the U.S. Federal Trade Commission over privacy violations and a $100 million settlement with the U.S. Securities and Exchange Commission over claims that misled investors about the risks of misuse of user data.