Facebook has agreed to settle a class-action complaint accusing the company of inflating video metrics by up to 900%, lawyers for marketing agencies told a judge Wednesday.
Settlement details haven't yet been revealed. The papers, filed Wednesday, say the settlement came about after an April mediation session, followed by two months of continuing negotiations.
If accepted by U.S. District Court Judge Jeffrey White in Oakland, California, the deal will resolve a legal battle dating to 2016, when marketers alleged that misrepresentations by Facebook resulted in inflated prices for video ads.
The allegations stem from a 2016 news report that Facebook inflated the average time spent viewing ad clips by 60% to 80%.
The company has said its mistaken calculations did not affect billing. But the marketers said the erroneous statistics led them to believe video ads on the platform were more valuable than they actually were, which led to higher prices.
Last year, the marketers who are suing (including LLE One, which does business as Crowd Siren and Social Media Models) alleged in an amended complaint that documents obtained from Facebook show that its average viewership metrics were inflated by 150-900%.
“Facebook either knew that the average viewership metrics it was reporting ... was false or reported those metrics recklessly and without regard for their truth,” the marketers alleged in the amended complaint. “The persistence of Facebook’s false metrics was possible only because Facebook did not take verification of its metrics seriously, severely understaffed the engineering team in charge of fixing errors, did not fully investigate or correct errors that were reported to it, and refused to allow third-party verification of its metrics.”