• by Wendy Davis  @wendyndavis, August 10, 2023

Meta Platforms this week urged a federal appellate court to reconsider its decision to revive claims that Facebook's former ad-targeting options violated laws against discrimination.

The decision, issued in June by a three-judge panel of the 9th Circuit Court of Appeals, rejected Meta's argument that it was protected from liability by Section 230 of the Communications Decency Act, which broadly immunizes web companies from content created by third parties.

Instead, the panel essentially said in an unsigned opinion that the allegations in the lawsuit, if proven true, could show that Facebook was a “co-developer” of the ads, not simply their host.

Meta now argues that ruling conflicts with prior decisions issued by the 9th Circuit.

“Plaintiffs sued Facebook for providing neutral tools that unidentified third-party advertisers allegedly chose to misuse,” the company wrote in a request for a new hearing before the entire Circuit. “The nature of those claims should have made this case easy under this court’s Section 230 case law, which holds that an interactive computer service provider cannot be held liable when it gives users of the service neutral tools they can use to communicate information.”

The company added that the panel “advanced its own novel view of how Section 230 ought to be interpreted,” instead of following precedents.

The battle dates to 2019, when resident Rosemarie Vargas and other Facebook users alleged in a class-action complaint that the company's ad-targeting platform violated civil rights laws by allowing advertisers to block housing ads from users based on factors such as race, sex or age.

The case was one of several lawsuits against Facebook over allegedly discriminatory ads.

By the time Vargas and the others sued, Facebook had already agreed to revise its targeting options to prohibit advertisers of housing, employment or credit offers from targeting ads based on age, gender, ZIP code and ethnic affinity.

U.S. District Court Judge William Orrick in the Northern District of California dismissed the complaint in 2021. He ruled that the Facebook users' allegations, even if true, wouldn't show how they were affected by Facebook's former ad-targeting options.

Orrick also said Facebook was protected by Section 230 for any illegal ads posted by outside parties, noting that the company's ad-targeting tools were neutral.

“Use of the tools was neither mandated nor inherently discriminatory given the design of the tools for use by a wide variety of advertisers,” he wrote. Vargas and the others then appealed to the 9th Circuit, which reinstated the lawsuit.

The panel majority said both that Vargas's allegations were specific enough to warrant further proceedings, and that Facebook was not entitled to rely on Section 230.

The judges based the portion of their ruling dealing with Section 230 on a 2008 decision that revived a discrimination lawsuit against housing matching service Roommates.com, which was sued over roommate ads posted by users. The appellate court said at the time that Section 230 didn't protect companies that actively developed unlawful material, and that Roommates.com developed the ads because it offered filtering tools that enabled discrimination. (Roommates.com later won that case, because anti-discrimination laws don't apply to people who live in the same home.)

The panel that ruled against Meta said Facebook was comparable to Roommates.com because Facebook's ad platform “allowed advertisers to target specific audiences, both by including categories of persons and by excluding categories of persons, through the use of drop-down menus and toggle buttons."

But Meta argues in its new papers that Facebook's ad-targeting service differed significantly from Roommates.com's housing matching service.

For instance, Meta argued, Roommates.com required users to provide information about race and other protected characteristics, but Facebook didn't require advertisers to exclude any adults from receiving ads.

“By default, all adult Facebook users are eligible to receive any ad,” the company writes.

The 9th Circuit directed lawyers for the plaintiffs to respond to Meta's request by August 29.