"It's like raising the scales on the price of goods, isn't it."
A United States (US) court has ruled that allegations about Facebook belonging to Meta Platfroms Inc. containing elements of fraud behind *potential access to its advertising services are true and subject to action.
*The total number of users or individuals who become followers or friends on the social media of a platform.
The court decision made by U.S. San Francisco District Judge James Donato allowed millions of individuals and businesses who pay for ad placement services on Facebook and Instagram apps to sue the company as a group.
So far, Meta has not given any statement or response on the decision.
For the record, DZ Reserve and other advertisers have accused Facebook of deliberately increasing its advertising reach potential by increasing the number of potential viewers by 400% then charging high fees to anyone who wants to place ads on the platform.
They also accused Facebook senior executives of realizing that the company’s potential reach metrics were raised by duplicate and fake accounts, yet acted in silence as well as taking steps to cover up the fraudulent act.
Donato in his filing stated there were various individuals involved in the scam including ‘large sophisticated companies’ as well as small businesses so it became too difficult to calculate damages, so the court has objected to Meta’s call for class certification that will identify and categorize them.
Therefore, Donato suggested that the individual plaintiffs sue Meta as a group as ‘no reasonable person’ would sue the company individually for a maximum premium of US $ 32.
Meanwhile, the judge expects later this year to consider Meta's offer to dismiss the lawsuit.
Generally, this will definitely affect Meta shares as the ad business is the company’s main source compared to the metaverse plan introduced in October last year.
