Siding against Facebook, the U.S. Department of Justice is urging a federal judge to reject the company's bid to dismiss a civil lawsuit accusing it of violating housing laws by facilitating ads that discriminate against women and families with children.
"Facebook’s ad utilities, as alleged in the complaint, invite housing providers to express unlawful demographic and other audience preferences," the Department of Justice writes in papers filed Friday with U.S. District Court Judge John Koeltl in New York. "In this way, Facebook goes beyond providing a blank slate for advertisers. Instead, Facebook’s advertising platform suggests unlawful options, including to landlords, developers, and housing service providers."
The Justice Department is weighing in on a legal battle dating to March, when the National Fair Housing Alliance alleged in a lawsuit that Facebook enables landlords and brokers to prevent ads from being shown to women, families with children, and users with interests suggesting a disability or particular national origin.
The housing advocates allege that between December 14, 2017 and February 23 of this year, Facebook accepted 40 ads that excluded home seekers based on their sex or family status. Facebook also allegedly allows housing advertisers to exclude certain categories of users -- like people who are interested in disabled parking permits, or in broadcasting company Telemundo -- from seeing ads.
Facebook has asked Koeltl to either transfer the lawsuit to the company's home state of California or dismiss it outright on the grounds that the Communications Decency Act immunizes platforms for illegal material posted by users.
That law broadly protects interactive service providers from liability for users' content, but has some exceptions -- including one for content "developed" by the providers. The scope of that exception is unclear.
Facebook argues that its ad platform doesn't fall within the exception, because its ad-targeting platform offers "neutral" tools to advertisers. The company argued in recent court papers that the "creation of neutral targeting tools that third parties may (or may not) choose to use when placing housing ads does not ... deprive Facebook of immunity from plaintiffs’ claims."
But the Justice Department says in its papers that Facebook crossed a line from interactive platform to content creator, due to its role in facilitating ad-targeting.
"Facebook is not entitled to CDA immunity at the motion to dismiss stage because, according to the complaint, Facebook mines user data, some of which users must provide, and then actively classifies users based on that data," the government writes. "Facebook’s claim that it is immune because the advertiser, and not Facebook, decides which categories of users to include or exclude from advertisements is specious."
In addition to the National Fair Housing Alliance's lawsuit, the Department of Housing and Urban Development filed its own complaint against Facebook last week; that complaint could lead to a new lawsuit.
Earlier this week, Facebook said it will remove more than 5,000 ad-targeting options, including ones that may enable discrimination based on ethnicity or religion. The company stated that the targeting tools "have been used in legitimate ways to reach people interested in a certain product or service," but that believes "minimizing the risk of abuse is more important."
Facebook's targeting tools first drew scrutiny by civil rights activistis two years ago, after ProPublica reported that Facebook's self-service ad tools allowed advertisers to block real estate ads from users classified as having an "ethnic affinity" of black, Asian-American or Hispanic.
A company spokesperson said at the time that the social networking service determines "ethnic affinity" based on pages and posts that users liked or engaged with.
After ProPublica's initial report, Facebook updated its ad guidelines to strengthen prohibitions against discrimination based on race, ethnicity, color, national origin, religion, age, sex, sexual orientation, gender identity, family status, disability, or medical or genetic condition. The company also said that it would require advertisers offering housing and employment ads to certify compliance with anti-discrimination laws.
Despite the move, ProPublica reported last November that the company still allowed advertisers to prevent minorities from viewing housing ads.
Last month, Facebook settled an investigation by Washington state Attorney General Bob Ferguson by promising to stop allowing advertisers to block ads for housing, credit, jobs, insurance and places of public accommodation from people based on ethnic affinities.