Meta investors, Zuckerberg to square off at $8 billion trial over alleged privacy violations
Shareholders of Meta Platforms , the parent company of Facebook, Instagram and WhatsApp, sued Zuckerberg and other current and former company leaders, saying they continually violated a 2012 agreement between Facebook and the Federal Trade Commission to protect users' data.
The case dates back to 2018, after it emerged that data from millions of Facebook users was accessed by Cambridge Analytica, a now-defunct political consulting firm that worked for Donald Trump's successful campaign for U.S. president in 2016.
Shareholders want Zuckerberg and the other defendants to reimburse the company for more than $8 billion in fines and other costs paid by Meta after the Cambridge Analytica scandal came to light, including a record $5 billion fine imposed on Facebook by the FTC in 2019 for violating the 2012 agreement.
Defendants in the case include former Chief Operating Officer Sheryl Sandberg, venture capitalist and board member Marc Andreessen, as well as former board members Peter Thiel, the Palantir Technologies (PLTR.O), opens new tab co-founder, and Reed Hastings, the co-founder of Netflix (NFLX.O), opens new tab.
Zuckerberg and the other defendants, who declined to comment, have dismissed the allegations in court filings as "extreme claims." Meta, which is not a defendant, also declined to comment.
The non-jury trial in Wilmington, Delaware, begins on Wednesday and is scheduled to last eight days. It will mostly focus on decade-old events and board meetings to determine how Facebook leaders implemented the 2012 agreement.
While the trial will cover long-ago policies, it comes as privacy concerns continue to dog Meta, which is under scrutiny for its training of AI models. The company says it has invested billions of dollars since 2019 in its program to safeguard users' privacy.
Jason Kint, the head of Digital Content Next, a trade group for content providers, said the case will fill in details about what the board knew - and when - regarding the data of users, who now total more than 3 billion daily across Meta's platforms. "There's an argument we can't avoid Facebook and Instagram in our lives," he said. "Can we trust Mark Zuckerberg?"
Two years ago, the defendants sought to dismiss the case before trial, which the judge declined. "This is a case involving alleged wrongdoing on a truly colossal scale," said Travis Laster, the judge handling the case at the time. The trial in the Court of Chancery will be overseen by Kathaleen McCormick.
Now the plaintiffs, individual investors and union pension funds including California's State Teachers' Retirement System, must prove what is often described as the most difficult claim in corporate law - showing that directors utterly failed in their duty of oversight. Legal experts said it appears to be the first trial on such a claim.
Zuckerberg and Sandberg are alleged to have knowingly caused the company to violate the law. While Delaware law protects directors and officers for bad business decisions, it does not protect them from illegal ones, even if they are profitable.
Defendants said in court filings that plaintiffs cannot deliver the evidence.
The shareholders in pretrial court papers said they can prove that after the 2012 agreement, Facebook continued deceptive privacy practices, at the direction of Zuckerberg. The defendants said the evidence will show that the company built a team to oversee privacy and hired an outside compliance firm and that Facebook was a victim of Cambridge Analytica's "studied deceit."
In addition to the central privacy claims, plaintiffs also allege that when Zuckerberg could see that the Cambridge Analytica scandal was about to break and send company stock lower, he was motivated to offload his stock and reaped at least $1 billion in profit. Defendants said evidence will show he used a stock-trading plan that can protect against insider-trading allegations. They also said the motivation was to benefit his charitable pursuits.
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The Independent
9 minutes ago
- The Independent
Trump appointees pushed more marble in Fed building renovation White House now attacks
President Donald Trump has looked to the marble finishes and hefty price tag of the Federal Reserve headquarters to claim grounds to fire Chair Jerome Powell, with whom he has tussled for years over interest rates. But the extensive use of marble in the building is, at least in part, the result of policies backed by Trump himself. As the Fed moved forward with plans to renovate its Great Depression-era headquarters in Washington during Trump's first term, it faced concerns in 2020 during a vetting process involving Trump appointees, who called for more 'white Georgia marble' for the facade of building. The Fed's architects said the central bank had wanted glass walls to reflect the Fed as a transparent institution, but three Trump appointees to a local commission felt marble best fit the building's historic character. Marble was added as a result, according to the minutes of the Commission of Fine Arts, which advises the federal government on architecture. The marble does not explain the roughly $600 million in cost overruns for the Fed headquarters and another nearby office building, now budgeted to cost $2.5 billion, which also includes the addition of an underground parking garage and new glass atria in the building's courtyards. But the roots of its extensive use further muddies the White House 's attempts to use the renovation to paint the central banker as profligate spender as a possible pretext to removing him. 'I wouldn't be surprised if the result costs more' because of the added marble, said Alex Krieger, a Harvard University emeritus professor who was a member of the commission and participated in hearings on the Fed's proposal. Russ Vought, Trump's top budget adviser, cited 'premium marble' in a letter to Powell last week as an example of the 'ostentatious overhaul.' In a response late Thursday, Powell wrote that the project would 'use new domestic marble" for several reasons, including "to address concerns raised by external review agencies." The National Capital Planning Commission, which also reviewed and approved the Fed renovation project, has started an inquiry into how Powell oversaw the updates. 'The Federal Reserve's extravagant multi-billion dollar renovation happened on the watch of the Fed's leadership, and the Fed's leadership needs to own up for this mismanagement of taxpayer dollars – as well as its botched coverup job,' said White House spokesman Kush Desai. A Fed spokesperson declined to comment. There is an uncomfortable possibility that the fate of the U.S. central bank and its foundational role in the economy hinges on a dispute about renovation costs and architecture, one that could lead a broader legal battle as to whether Trump can dismiss a Fed chair he dislikes after the Supreme Court in May described the institution as having protections against an abrupt firing. Trump White House investigating renovation Trump, who has redecorated the Oval Office in gold leaf, has argued that inflation is not a concern, so the Fed can dramatically slash its rate to encourage more borrowing. But Powell and other Fed committee members are waiting to see whether Trump's tariffs lift inflation, which higher interest rates could help blunt. The Fed chair pushed back against criticism during a June congressional hearing that the renovation was lavish by saying some features were removed due to cost, leading the White House to speculate as to whether Powell deceived lawmakers or made changes to the renovation plans without getting additional approvals. At that hearing, Sen. Tim Scott, R-S.C., also cited 'white marble' as an example of extravagance. James Blair, a White House deputy chief of staff who was recently added to the planning commission, said Wednesday that he would send a letter to the Fed requesting any revisions to the project. His goal is to see whether Powell was accurate in his congressional testimony. 'He's either telling the truth or he isn't,' Blair told The Associated Press. 'If he's telling the truth, he can prove it by just submitting all the plans and revisions.' Trump said Wednesday that he's 'highly unlikely' to try to fire Powell unless there was what he deemed as 'fraud.' The attempt to remove Powell before his May 2026 term as chair ends could unleash a devastating financial blowback, as financial markets expect the Fed, with its mission of stabilizing prices and maximizing employment, to be free of White House politicking. The perception that the central bank would use its powers to serve Trump's political ends could lead to higher interest rates on the U.S. debt and mortgages, instead of the declines being promised by the president. Trump appointees push for more marble The 115-year old Commission of Fine Arts reviewed the plans for the renovation three times in 2020. Duncan Stroik, who was appointed to the commission in 2019 during Trump's first term, 'proposed an amendment requesting that the next submission include an alternative design in white Georgia marble, the same material used for the five existing buildings along the north side of Constitution Avenue,' the minutes of a Jan. 16, 2020, meeting said. Stroik 'does not think the proposed additions defer to the historic buildings as great marble edifices on an important street,' the minutes added. Stroik's amendment was voted down, but the commission didn't fully endorse the Fed's plans. The architects presented new plans in May 2020, though those didn't appear to satisfy Trump's appointees. Some commissioners 'continued to object to the addition as a glass box that is reminiscent of a commercial office building, glowing at night, that would present an unacceptable contrast to the solid masonry architecture of the historic building in its monumental context,' the commission wrote in a May 2020 letter to a Fed official. By July 2020, however, the Fed's architects came back with a new proposal, which included 'panels of white Georgia marble" which would be used for the 'base, cornice, and other details, consistent with the historic building," the commission's minutes said. Neoclassical vs. modern designs Stroik, now a professor of architecture at the University of Notre Dame, said in an interview that 'stone buildings don't necessarily have to cost a fortune.' But he acknowledged that the commission had not discussed expenses, which has not been part of its mission. 'If they wanted to play the cost game, you do a marble facade and you do the glass facade and you compare the cost,' Stroik said. 'And you know, they never did that." Krieger, the former commission member, noted that the body's discussions became much more contentious after the Trump administration removed several members and replaced them with Stroik and James McCrery, a professor at Catholic University, whom he said often echoed the sentiments in a then- draft executive order from Trump that extolled classical architecture. 'At the time, it was a fierce battle over how literal to the original design should the renovations be,' Krieger said. 'Normally, that attitude does add costs to the construction project.' McCrery declined to comment. Trump issued the executive order in December 2020, which criticized modernist architecture and expressed a preference for 'beautiful" classical buildings with more traditional designs. Biden revoked the order, and Trump reissued it the first day of his second term. The commission did not fully approve the Fed's project until September 2021, after McCrery and another Trump appointee, Justin Shubow, had been removed by then President Joe Biden. __
The Independent
9 minutes ago
- The Independent
CBS staff in turmoil over ‘Trump shakedown' after Stephen Colbert and The Late Show are canceled
CBS staffers aren't buying the network's claims that the cancellation of Stephen Colbert's top-rated, late-night show was purely a 'financial decision,' but rather a continuation of the 'Trump shakedown' that began with parent company Paramount's settlement of the 60 Minutes lawsuit, according to multiple sources. Despite The Late Show averaging 2.4 million total viewers on a nightly basis and handily beating rival networks' late-night competition, Paramount and CBS executives announced in a joint statement Thursday that Colbert's long-running program would come to an end next year. 'T he Late Show With Stephen Colbert will end its historic run in May 2026 at the end of the broadcast season. We consider Stephen Colbert irreplaceable and will retire The Late Show franchise at that time,' the announcement – signed by Paramount co-CEO George Cheeks, CBS Entertainment president Amy Reisenbach and CBS Studios president David Stapf – noted. 'We are proud that Stephen called CBS home. He and the broadcast will be remembered in the pantheon of greats that graced late night television.' Calling it an 'agonizing decision,' the executives added: 'This is purely a financial decision against a challenging backdrop in late night. It is not related in any way to the show's performance, content or other matters happening at Paramount.' The news dropped like a lead balloon for fans, who immediately groaned and booed when Colbert revealed on his show Thursday night that he would be wrapping up for good next May. 'I share your feelings,' he said to the disappointed studio audience. While the corporate bosses insist the decision was merely due to late-night television becoming unprofitable because of dwindling ad revenues and high production costs, it cannot be ignored that it comes amid Paramount's pending $8.4 billion merger with Skydance, the media and film production giant, which requires approval from the Trump administration. Additionally, Colbert has been highly critical of Paramount's settlement with Trump, agreeing with lawmakers and journalism groups that the $16 million payment to the president to drop a lawsuit that legal experts said was 'frivolous' and akin to bribery. 'While I was on vacation, my parent corporation, Paramount, paid Donald Trump a $16 million settlement over his '60 Minutes' lawsuit,' Colbert said Monday after returning from a multi-week break. 'As someone who has always been a proud employee of this network, I am offended. And I don't know if anything will ever repair my trust in this company, but just taking a stab at it, I'd say $16 million would help,' he quipped, adding that the 'technical name in legal circles' for the settlement is 'a big, fat bribe.' Several network sources told The Independent that while they understand that Colbert's program had become costly to run over the years, and was potentially a drain on the network's bottom line, many people working at CBS don't fully believe the narrative coming from upper brass about the cancellation. One senior staffer at CBS, for instance, said that no one at the network 'is buying that it's a financial decision,' adding that the demise of the CBS flagship left 'everyone stunned,' including 'famous comedians' that the source said they knew. Indeed, responding to the news that his late-night rival would soon be out of a job, ABC star Jimmy Kimmel posted on Instagram: 'Love you, Stephen. F*** you and all your Sheldons, CBS.' Another network staffer said they were told the show had been 'on the chopping block' for a few years because it was 'very expensive to produce.' At the same time, though, this insider said that they didn't believe this was the reason behind the sudden announcement on Thursday. 'Many of us think this was part and parcel of the Trump shakedown settlement,' the staffer declared. Meanwhile, The Independent has also learned that staffers at Comedy Central's The Daily Show, which is also owned by Paramount, are expressing concern that their program could be next. The Independent has reached out to Paramount and CBS for comment. Earlier this month, after Paramount reached its settlement with Trump, Status News' Oliver Darcy reported that the upcoming merger with Skydance – which is led by pro-Trump billionaires Larry and David Ellison – could result in the cancelations of Colbert and Daily Show host Jon Stewart, both vocal critics of the president. Stewart, like Colbert, has also pilloried Paramount for paying off Trump. 'What better gift could [the Ellisons] give Trump than to get rid of Colbert and Stewart?' one media insider told Status. Stewart, meanwhile, recently noted on his podcast that he 'unfortunately' hasn't spoken with soon-to-be new corporate boss David Ellison or any other Skydance brass, amid rumors that he could soon be booted. 'I've been kicked out of sh*ttier establishments than that. We'll land on our feet,' he said. Amid the fallout over the Colbert announcement, Democratic lawmakers are sounding alarm bells that the move could be politically motivated. 'If Paramount and CBS ended 'The Late Show' for political reasons, the public deserves to know,' Democratic Senator Adam Schiff, of California, who was a guest on Colbert's show Thursday night, posted on social media. Echoing Schiff's sentiments, Massachusetts Senator Elizabeth Warren – who had previously warned Paramount that it could face congressional probes for violating anti-bribery statutes – noted that the decision came 'just THREE DAYS after Colbert called out CBS parent company Paramount for its $16M settlement with Trump.' 'America deserves to know if his show was canceled for political reasons,' she added. Whether this move was made to appease Trump or not, the president made it clear that he was pleased with the result either way. 'I absolutely love that Colbert got fired,' Trump gloated on Truth Social on Friday. 'His talent was even less than his ratings. I hear Jimmy Kimmel is next. Has even less talent than Colbert! Greg Gutfeld is better than all of them combined, including the Moron on NBC who ruined the once great Tonight Show.'
Daily Mail
10 minutes ago
- Daily Mail
BREAKING NEWS Bryan Kohberger victim's father shares harrowing new details of her final moments and brutal injuries
The father of one of Bryan Kohberger 's victims has revealed shocking new details about his daughter's final moments, as he hit out at the secrecy that continues to shroud the case. Steve Goncalves told NewsNation Thursday his 21-year-old daughter Kaylee Goncalves had 'damage around her mouth' indicating that her killer tried to gag and silence her while stabbing her to death. Steve said Latah County Coroner Cathy Mabbutt, who conducted the victims' autopsies, said her injuries were 'like somebody had pressed in and tried to keep her quiet' during the vicious attack. The harrowing new details emerged as the Goncalves family prepares to deliver victim impact statements at Kohberger's sentencing next week - but voiced frustration at being in the dark about some of the details of the murders. 'You only got one time to be able to be a victim's advocate and say what you need to say and to address the courtroom and everyone in Idaho, and they're not going to let us know exactly what happened,' Steve said. 'We want to make sure everything we say is exactly truthful.' Kohberger is set to be sentenced on July 23 for the murders of Goncalves, her 21-year-old best friend Madison Mogen and 20-year-old couple Xana Kernodle and Ethan Chapin. The 30-year-old killer - who had spent years studying criminology -finally confessed to the murders in a stunning turn of events earlier this month. Kohberger broke into a student home in Moscow, Idaho, in the dead of the night on November 13, 2022, and stabbed the four victims to death. He was arrested around six weeks later but spent more than two years fighting the charges. Just weeks before his trial was slated to begin in August, Kohberger struck a controversial deal with prosecutors, changing his plea to guilty on all four counts of murder and one count of burglary. Under the terms of the deal, he will be spared from the death penalty and will be sentenced to life in prison without the possibility of parole, while waiving all rights to appeal. The Goncalves family vehemently opposed the plea deal, with Steve protesting outside the change of plea hearing in Ada County Courthouse in Boise on July 2. With Kohberger no longer facing trial, Judge Steven Hippler lifted a sweeping gag order Thursday, but refused to immediately unseal all records related to the case. In an appearance on CBS Mornings Friday, Goncalves' parents Kristi and Steve Goncalves blasted the ongoing secrecy in the case which they claim protects the man who murdered their daughter and her friends. 'I think by hiding the truth we are protecting our killers,' Steve told Gayle King. 'We have to show the ugliness of what this person did.' Steve said the family feels the need to know all the details about how their daughter died in order to prepare to confront Kohberger in court. 'We're writing our victim impact statements and we don't even know what the impact is as they've hid the impact from all of us,' he said. 'I need to know the facts. How many times was my daughter stabbed? Was she choked? What happened? 'And that should be party of our victim impact statement. They're robbing us. And they're protecting he killer still.' Kristi added that the victims' families don't know 'any more than pretty much everybody else' about the murders and the case as a whole. She said she hopes that 'with this gag order being lifted it will allow us to know more about what happened to our daughter.' To this day, the parents said they still don't know what the motive for the murders was. A gag order of some sorts - known as a non-dissemination order - has been in place since the early days blocking law enforcement, attorneys for both sides and other officials from speaking publicly about the case. The order - together with the broad sealing of records and evidence by the court - has restricted what information the public and the victims' families have had access to throughout the almost three-year-long proceedings. Throughout the years-long proceedings, the court found it necessary to protect Kohberger's right to a fair trial. During the July 2 change of plea hearing, Judge Hippler said the gag order would remain in place through sentencing, prompting a coalition of media organizations - including the Daily Mail - to file a motion calling for it to be lifted. 'There is no possible set of circumstances under which Mr. Kohberger will ever face a jury to determine his guilt or to determine whether the death penalty should be imposed,' the coalition argued. 'No trial will occur. Thus, there is no need to preserve Mr. Kohberger's 'right to a fair trial' because he has already admitted guilt.' In a brief court hearing Thursday, the judge agreed, saying that 'the rights of the public to information in this case is paramount given the fact that a plea has been entered in this case.' Dressed in a burgundy t-shirt, Kohberger looked on over Zoom from Ada County Jail - the first time he has been seen in public since he admitted to the murders. While lifting the gag order, Judge Hippler said he was 'denying outright' a separate motion to unseal all records in the case, calling it 'premature.' Instead, he said that, after sentencing, the court will begin the process to review all the records in the case to determine what can be unsealed and what should remain sealed. 'That process is going to take time - I'm not talking days, I'm probably not talking weeks... patience will be required,' he said. Despite Kohberger's guilty plea, a lot of information about the murders remains a mystery. The 30-year-old has not revealed a motive for the attack and there is no known connection between him and his victims. During the change of plea hearing, Thompson revealed that Kohberger bought a Ka-Bar knife and sheath from Amazon in March 2022 - months before the killings. In June 2022, he moved from his parents' home in Pennsylvania to Pullman, Washington, where he enrolled on the criminal justice PhD program at Washington State University. From the following month onwards, his cell phone pinged close to the victims' home at 1122 King Road - indicating that he likely stalked or surveilled at least one of the women who lived there. At around 4am on November 13, 2022, Kohberger broke into the three-story home and went straight up to Mogen's room on the third floor, where he murdered Mogen and Goncalves. On his way back downstairs or on leaving the property, the prosecutor said he encountered Kernodle on the second floor, who had just received a DoorDash food order. He attacked her with the knife and then also murdered Chapin who was sleeping in her bed. Kohberger then left through the back sliding door on the second story of the property, passing roommate Dylan Mortensen who had been woken by the noise and peeked around her bedroom door. Mortensen and roommate Bethany Funke - whose bedroom was on the first floor - were the only survivors. Prosecutors believe Kohberger did not intend to kill all four victims that night - but did enter the home intending to kill and had planned his attack for some time. He was tracked down, after he left a Ka-Bar leather knife sheath next to Mogen's body at the scene. Through Investigative Genetic Genealogy, the FBI managed to trace DNA on the sheath to Kohberger. Kohberger will return to Ada County Court for his sentencing on July 23, where the families of the victims will be given the opportunity to deliver impact statements.
