Cambridge Analytica

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The current Supreme Court term promised to be an interesting one from a securities law standpoint, as the Court had agreed to take up two cases dealing with key securities class action litigation issues. One of those cases is the securities case involving the Facebook/Cambridge Analytica’s user data scandal. The Facebook case would have required the Court to address an important and recurring disclosure related issue. However, on November 22, 2024, the Court issued a single-line order stating that “the writ of certiorari is dismissed as improvidently granted,” meaning that the Supreme Court’s consideration of the Facebook case will now not go forward, and the Ninth Circuit’s ruling in the case, in which the appellate court reversed in part the district court’s dismissal of the case, will now stand. A copy of the Supreme Court’s November 22, 2024, order can be found here.Continue Reading U.S. Supreme Court Dismisses Facebook Case, Saying Writ Improvidently Granted

I have long thought that privacy-related issues represent one of the important emerging areas of D&O liability exposure. One case that I thought represented an example of this emerging risk was the securities class action lawsuit brought against Facebook related to the Cambridge Analytica user data privacy scandal. However, when the court granted the motion to dismiss in the case, the relevance of the Cambridge Analytica case to the discussion of privacy-related issues seemed diminished. But the appellate court has now reversed in part the lower court’s dismissal, restoring the relevance of the case to the privacy-related discussion and highlighting the importance of privacy concerns as an area of emerging D&O liability risk. The Ninth Circuit’s October 18, 2023, opinion in the case can be found here.Continue Reading Ninth Circuit Revives in Part Facebook Privacy-Related Securities Suit

Two of the most prominent examples of the rise of privacy-related securities class action lawsuits are the Cambridge Analytica scandal-related suit filed against Facebook in March 2018, and the Earnings Miss/GDPR-readiness and compliance-related securities suit filed against Facebook in July 2018. These two lawsuits were ultimately consolidated. In an interesting and detailed September 25, 2019 order (here), Northern District of California Edward J. Davila granted without prejudice the defendants’ motions to dismiss the consolidated lawsuit, finding that the plaintiffs had failed to adequately plead falsity and scienter. There are a number of interesting features to Judge Davila’s ruling, as discussed below.
Continue Reading Facebook Privacy-Related Securities Suit Dismissed Without Prejudice