Facebook Investors Sue Facebook Over Voter Profile Harvesting

In just two days, Mark Zuckerberg's wealth took a nearly $8 Billion dollar hit.


latimes.com:  Facebook Investors Sue the Social Media Giant Over Voter Profile Harvesting

http://www.latimes.com/business/technology/la-fi-tn-facebook-investor-lawsuit-20180320-story.html

Facebook investors sued Facebook on Tuesday, blaming the social media giant's failure to safeguard privacy for a stock slump that followed the revelation that users' data were harvested without permission by a research firm connected to President Trump.  The world's largest social media network was sued in San Francisco federal court Tuesday by shareholders who said they suffered losses after the disclosure that Cambridge Analytica, a British company that aided Trump, improperly obtained profile information on 50 million Facebook users.

The proposed class action would represent people who bought Facebook shares from Feb. 3, 2017, when Facebook filed its annual report and cited security breaches and improper access to user data, through March 19 of this year, two days after a New York Times report revealed how data from Cambridge Analytica obtained through Facebook were used without "proper disclosures or permission."



This article references one of the greatest examples of effective crisis management in business:  the Tylenol murders of 1982. The strategy saved a corporation from what many thought was certain doom and revolutionized the packaging of all over-the-counter medications. The perpetrators were never apprehended.


work.qz.com:  Why is Facebook Failing to Follow the Basic Rules of Crisis Management?

https://work.qz.com/1233417/why-is-facebook-failing-to-follow-the-basic-rules-of-crisis-management/

The textbook way to handle a corporate crisis is so well established, there’s actually a textbook for it. Several, in fact.

But it appears no one at Facebook has bothered to study them. The tech giant’s reaction to the rapidly unfolding Cambridge Analytica scandal has been clumsy, defensive, and confused. The fumbling is all the more surprising given Facebook’s vast resources, its PR-savvy leadership, and its dependence on the continued goodwill of its 2.2 billion users and the governments around the world that allow it to flourish.

In other words, it really should get this right.



I can't see how the stockholders can possibly win this suit. At the time of the data harvesting, it was stated Facebook policy to allow apps to connect to the app user's friends. It's not like CA stole the data surreptitiously or hacked into Facebook to get it.  FB later changed that policy, so they've already dealt with the problem.

I guess I should read the article first....

ETA: This is from the article:

Throughout that period, "defendants made false or misleading statements and failed to disclose that Facebook violated its own data privacy policies by allowing third parties access to personal data of millions of Facebook users without their consent," the complaint alleges.

My understanding of the situation tells me that the quoted statement is not a factual charge. The data was given away with consent, though usually unknowingly, if that's possible. Also the suit only deals with the period of March 2017 onward, by which time the whole thing was moot.

Will be interesting to see what happens.

Zuckerberg's disingenuous statement:

“We have a responsibility to protect your data,” Mr. Zuckerberg said Wednesday in a Facebook post, his preferred means of communication, “and if we can’t then we don’t deserve to serve you.”

The fact is Facebook does NOT serve the users whose data they hold.

Facebook users are their commodity whose data is extracted and sold to whoever pays. Like a car, a pen, a ream of paper, or a service like  hotel concierge, etc. Corporations do not serve cars, pens or paper reams or their concierges.

They do, however, try to ensure their products are not damaged. In that respect Facebook may have failed.

Facebook serves the customers who pay to buy their product, your data.


Yes, and the investors are upset about their loss in share price, not the privacy invasion suffered by the commodity. 


LA Times story makes for a catchy headline but as a financial journalist myself, I can say this is a total non-news item.

Anytime a stock drops significantly, or a big-name stock drops even a small amount, class-action lawyers spring into action. Like swallows returning to Capistrano. 


Nearly every major digital property uses the personal data, habits of its users, location, and imputed information to sell advertising. 

The web is not free.  The content you see, the ads you see are pretty much all targeted. That was the promise of old media going digital -- never before have you been able to reach the specific people you want like this!

That's the way it is. As advertisers are allowed to access data on publishing platforms -- this stuff will continue to happen. 

Install ad blockers, don't click on ads -- that's about the only way to avoid it.  Or go to the library.


More trouble for Facebook: 

"Facebook Vowed to End Discriminatory Housing Ads. Suit Says It Didn’t."

https://nyti.ms/2pFMipN


Fair housing groups filed a lawsuit in federal court on Tuesday saying that Facebook continues to discriminate against certain groups, including women, disabled veterans and single mothers, in the way that it allows advertisers to target the audience for their ads. The suit comes as the social network is scrambling to deal with an international crisis over the misuse of data belonging to 50 million of its users.

[...jump to end]

ProPublica, a nonprofit newsroom dedicated to investigative journalism, raised the issue of discriminatory housing ads in an October 2016 article that described how advertisers could keep users who were black, Hispanic or had other “ethnic affinities” from seeing housing ads.

That got the attention of the National Fair Housing Alliance, which sent a letter to Facebook saying that its ad practices appeared to violate fair-housing laws and asked for a meeting. In November 2016, Facebook said it would disable the use of “ethnic affinity marketing for ads that we identify as offering housing employment or credit.”

A year ago, Facebook said its policy expressly forbid ads that have discriminatory content.

But a second article by ProPublica in November found that housing ads that specifically excluded African-Americans, people interested in wheelchair ramps, Jews and Spanish speakers could still be placed on Facebook’s platform.

The following month, an article by The New York Times and ProPublica found that national employers like Verizon, Goldman Sachs and Amazon had placed job recruitment ads limited to certain age groups, while hundreds of millions of other internet users never saw the ads.

“We thought they were sincere,” said Lisa Rice, president of the National Fair Housing Alliance. “But they have not changed their content, their platform and their systems to preclude advertisers from discriminating. When you think that Facebook has over two billion active users, that’s pretty significant.”


I think it's possible for Zuck to be a genius for his "invention" and woefully naive or in denial about its possibilities for abuse. "With great power comes... ."

Also Mark, dress like an adult when you go to DC. All these young Steve Jobs wannabes - with their signature dress and carefully-choreographed hand/arm gestures onstage - are wearing thin.




peteglider said:

Nearly every major digital property uses the personal data, habits of its users, location, and imputed information to sell advertising. 

The web is not free.  The content you see, the ads you see are pretty much all targeted. That was the promise of old media going digital -- never before have you been able to reach the specific people you want like this!


That's the way it is. As advertisers are allowed to access data on publishing platforms -- this stuff will continue to happen. 

Install ad blockers, don't click on ads -- that's about the only way to avoid it.  Or go to the library.

Or pass legislation that allows us to SELL the data about us rather than giving it away for the profit of the companies who sell it.


Remember all those "alerts" that Facebook was going to start charging it's subscribers?  That was never going to happen because WE are the product.  BUT, that is also why we will never be able to sell our data ... they already own it.


How many FB users thought they were just getting a free ride from a boy genius?

How many would gladly trade privacy for the service?

How many are faux appalled?

Serious questions. What %?



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