• by Wendy Davis  @wendyndavis, November 11, 2024

The Supreme Court has asked attorneys for advertisers to respond to Meta's petition for review of a lower court's order requiring the platform to face a class-action fraud suit on behalf of 3 million businesses that purchased ads on the platform.

Meta sought review of that order last month, arguing that the advertisers shouldn't be able to proceed with a class-action because they didn't have enough in common.

Counsel for the advertisers initially waived the right to respond to Meta's request. But on Friday, the Supreme Court asked counsel to file a response by no later than December 8.

The move doesn't mean the court will agree to hear Meta's appeal, but suggests that at least one justice is interested in the matter, according to Bloomberg Law. While the Supreme Court rejects most petitions for review, asking for a response slightly increases the likelihood it will hear the case, according to a 2018 Bloomberg analysis.

The battle between Meta and the advertisers began in 2018, when business owner Danielle Singer alleged in a class-action complaint that Facebook induced advertisers to purchase more ads, and pay more for them, by overstating the number of users who might see the ads. (Singer later dropped out of the litigation, and DZ Reserve, which operated an e-commerce store, and Max Martialis, which sold weapons accessories, became the lead plaintiffs.)

Singer's initial complaint cited a report by the industry organization Video Advertising Bureau, which said Facebook's estimates of audience reach in every U.S. state were higher than the states' populations. The plaintiffs alleged in a 2020 amended complaint that Facebook employees were aware of complaints about the potential reach metric since September 2015.

Meta argued to U.S. District Court Judge James Donato in San Francisco that the case shouldn't proceed as a class-action because the advertisers were too different from each other.

Donato rejected that argument and certified a class of all U.S. advertisers who used Facebook's Ad Manager or Power Editor to purchase ads on Facebook or Instagram after August 15, 2014.

Meta appealed to the 9th Circuit Court of Appeals, which upheld Donato's order in a 2-1 decision.

Last month, Meta asked the Supreme Court to intervene in the matter, arguing in a petition for review that questions about how its estimate of potential reach affected advertisers call for case-by-case determinations, making class-action treatment inappropriate.

The class certified by Donato includes “millions of diverse advertisers ranging from sole proprietors to Fortune 500 companies -- with a correspondingly wide range of advertising budgets,” Meta wrote, adding that the amount by which the potential reach was inflated varied by advertiser.

Meta also said many of its advertisers based decisions on factors other than the potential reach estimate -- such as whether web users clicked on ads or made purchases.

The U.S. Chamber of Commerce backed Meta's request, arguing in a friend-of-the-court brief that the 9th Circuit's ruling “will make it too easy to certify nationwide consumer-fraud classes.”