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Facebook, Inc. Class Action Lawsuit - FB

Company Name
Facebook, Inc.
Stock Symbol
FB
Motion Deadline
December 26, 2021
Court
Eastern District of New York
27 days left to seek lead plaintiff status

Case Summary

The Facebook securities class action lawsuit charges Facebook, Inc. (NASDAQ: FB) and certain of its top executives with violations of the Securities Exchange Act of 1934.  The first-filed Facebook class action lawsuit was commenced on October 27, 2021 in the Eastern District of New York and is captioned Ngian v. Facebook, Inc., No. 21-cv-05976.  A second class action lawsuit was commenced on November 12, 2021 in the Northern District of California and is captioned Ohio Pub. Emps. Ret. Sys. v. Meta Platforms, Inc. f/k/a Facebook, Inc., No. 4:21-cv-08812.

If you wish to serve as lead plaintiff of the Facebook securities class action lawsuit, please provide your information by clicking here.  You can also contact attorney J.C. Sanchez of Robbins Geller by calling 800/449-4900 or via e-mail at jsanchez@rgrdlaw.com.  Lead plaintiff motions for the Facebook securities class action lawsuit must be filed with the court no later than December 27, 2021.

CASE ALLEGATIONS:  The Facebook securities class action lawsuit alleges that defendants made false and misleading statements and failed to disclose that: (i) Facebook misrepresented its user growth; (ii) Facebook knew that duplicate accounts represented a greater portion of its growth than stated, and it should have provided more detailed disclosures as to the implication of duplicate accounts to Facebook’s user base and growth; (iii) Facebook did not provide a fair platform for speech, and regularly protected high profile users via its Cross Check/XCheck system; (iv) despite being aware of their use of Facebook’s platforms, Facebook failed to respond meaningfully to drug cartels, human traffickers, and violent organizations; (v) Facebook has been working to attract preteens to its platform and services; and (vi) as a result, defendants made public statements that were materially false and misleading.

On September 13, 2021, The Wall Street Journal published an article titled “Facebook Says Its Rules Apply to All.  Company Documents Reveal a Secret Elite That’s Exempt.”  This Wall Street Journal article would be the first of nine articles published by the outlet based on documents provided by a then-unknown whistleblower (the “Whistleblower”).  The article, among other things, reported that Facebook’s CEO and founder, defendant Mark Zuckerberg, “has publicly said Facebook Inc. allows its more than three billion users to speak on equal footing with the elites of politics, culture and journalism, and that its standards of behavior apply to everyone, no matter their status or fame.  In private, the company has built a system that has exempted high-profile users from some or all of its rules.”

Over the next several weeks, a consortium of news agencies – including The Wall Street Journal, The New York Times, Bloomberg, The Washington Post, and others – published numerous additional articles based on the internal documents provided by the Whistleblower, later revealed to be Frances Haugen (known as the Facebook Papers).  As The Wall Street Journal reported, the files demonstrate that “Facebook[] knows, in acute detail, that its platforms are riddled with flaws that cause harm, often in ways only the company fully understands,” yet Facebook failed to fix these problems.

Thereafter, on October 3, 2021, CBS News aired a television segment on 60 Minutes interviewing Haugen, on her findings during her time at Facebook.  On that same day, CBS published an article containing highlights from the interview, stating, among other things, that “Facebook has realized that if they change the algorithm to be safer, people will spend less time on the site, they’ll click on less ads, they’ll make less money.”  The following day, on October 4, 2021, CBS News published an article titled “Whistleblower’s SEC Complaint: Facebook Knew Platform Was Used to ‘Promote Human Trafficking and Domestic Servitude,’” containing the whistleblower complaints against Facebook filed with the U.S. Securities and Exchange Commission. 

On October 21, 2021, The Wall Street Journal published an article that raised concerns about the accuracy and reliability of Facebook’s user metrics.  On October 25, 2021, Facebook reported third quarter 2021 financial results, revealing that Facebook had missed revenue and monthly active users expectations for the quarter and provided disappointing guidance for the remainder of the year.

By the end of October 2021, the price of Facebook stock had fallen to a low of $308 per share, inflicting tens of billions of dollars in losses on Facebook investors.

THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased Facebook securities to seek appointment as lead plaintiff in the Facebook securities class action lawsuit.  A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class.  A lead plaintiff acts on behalf of all other class members in directing the Facebook securities class action lawsuit.  The lead plaintiff can select a law firm of its choice to litigate the Facebook securities class action lawsuit.  An investor’s ability to share in any potential future recovery of the Facebook securities class action lawsuit is not dependent upon serving as lead plaintiff.

ABOUT ROBBINS GELLER RUDMAN & DOWD LLP: With 200 lawyers in 9 offices nationwide, Robbins Geller Rudman & Dowd LLP is the largest U.S. law firm representing investors in securities class actions.  Robbins Geller attorneys have obtained many of the largest shareholder recoveries in history, including the largest securities class action recovery ever – $7.2 billion – in In re Enron Corp. Sec. Litig.  The 2020 ISS Securities Class Action Services Top 50 Report ranked Robbins Geller first for recovering $1.6 billion for investors last year, more than double the amount recovered by any other securities plaintiffs’ firm.

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