• by Wendy Davis  @wendyndavis, February 11, 2025

Three Facebook users are urging an appellate court to intervene in a lawsuit alleging that Meta Platforms monopolized the social networking services market by misrepresenting its privacy practices.

In papers filed late last week with the 9th Circuit Court of Appeals, the users contend that U.S. District Court Judge James Donato in San Francisco wrongly refused to allow the case to proceed as a class-action. The users are now asking the 9th Circuit for permission to appeal that ruling.

“Facebook knew that users care deeply about their data and online privacy and created the false impression that it was a trustworthy steward of their data -- for example, by falsely indicating it would not share certain user data with advertisers -- to obtain an unfair competitive advantage,” counsel for the users writes. “The case raises important issues regarding the antitrust laws, their application to firms in the digital economy, and the value of data.”

The move comes in a lawsuit brought against Meta in 2020 by Vermont resident Maximilian Klein and Illinois resident Sarah Grabert (and later joined by a third plaintiff, Minnesota resident Rachel Banks Kupcho).

They alleged that Facebook grew in popularity after deceiving consumers about its privacy policy, then “weaponized” consumer data in order to acquire potential rivals like social media service Instagram (acquired for $1 billion in 2012) and messaging service WhatsApp (bought for $19 billion in 2014).

They sought to represent a class of people in the U.S. who used Facebook December 2016 and December 2020, and argued that class-action status was appropriate because all Facebook users were equally “overcharged” by Meta.

That argument centered on a claim that Meta would have had to pay each user $5 per month for his or her personal data, had it not obtained a monopoly. The $5 per month figure came from a witness presented by the plaintiffs -- economist Nichola Economides.

Donato rejected the plaintiffs' theory last month.

“Although there is no doubt that Dr. Economides is a well-qualified economist, his opinion, among others, that Facebook users suffered antitrust injury because Meta did not pay them $5 a month for their personal data is unsupported by the record,” Donato wrote in a ruling denying class-certification.

He added that Economides' opinion “is a conclusion of fiat rather than evidence,” writing: “There is no doubt, as he says, that Meta makes a lot of money from user data, but he did not demonstrate that Meta would be compelled to retain users by paying them, rather than through innovations in services and product quality.”

Counsel for the plaintiffs argues that Donato wrongly rejected Economides' opinion.

“It was for the jury, not the court, to weigh that conflicting evidence to decide what Facebook would have done to compete if it had not employed misrepresentations of its data and privacy practices to monopolize the market,” the plaintiffs' lawyers argue.

They add that even though the ruling only addressed class-certification, it all but ended the lawsuit because their arguments hinged on Economides' theories.

Donato's order “sounds the death knell for plaintiffs’ case because it excludes professor Economides’ opinions, which the district court held were essential to plaintiffs’ ability to establish the required element of antitrust injury,” counsel contends.

The Federal Trade Commission is separately suing Meta over its acquisitions of Instagram and Whatsapp.