• An $8 billion lawsuit against Meta executives over privacy violations has been settled.
• The lawsuit stemmed from the Cambridge Analytica scandal affecting millions of Facebook users.
• Shareholders accused executives of failing to protect user data and comply with FTC agreements.
• The settlement was announced just as the trial was set to enter its second day.
• Details of the settlement remain undisclosed.

Meta CEO Mark Zuckerberg and several current and former directors have settled an $8 billion class action lawsuit alleging that they mismanaged user privacy protection following the Cambridge Analytica scandal. The case alleged repeated violations of a 2012 Federal Trade Commission (FTC) consent order designed to safeguard user data. Shareholders claimed that the executives did not fully disclose the risks associated with data misuse and sought reimbursement of substantial fines and legal costs incurred by Meta due to these breaches, which total over $8 billion, according to Reuters, Al Jazeera, and BBC.

The lawsuit was initiated after revelations that Cambridge Analytica had accessed personal data of millions of Facebook users to influence political campaigns, particularly during the 2016 U.S. presidential election. The fallout from this incident led Facebook to incur a historic $5 billion penalty in 2019 from the FTC for its data handling practices. Plaintiffs argued that executives, including Zuckerberg and former COO Sheryl Sandberg, enabled ongoing violations of user privacy, worsening the fallout from the scandal, reports CBS News and India Times.

The settlement was reached unexpectedly on July 17, just as the trial was to proceed into its second day, where major testimonies from Zuckerberg and others were anticipated. Both sides did not disclose the specific terms of the settlement, although the plaintiffs' attorney indicated that it came together rapidly. Experts noted that settling avoids any probing questions under oath for executives, allowing them to evade deeper scrutiny of their roles during the scandal, according to South China Morning Post and Newsweek.

Investments to improve user privacy have reportedly been made by Meta since 2019, yet the legal repercussions from the Cambridge Analytica scandal continue to challenge the company. Observers expressed disappointment over the settlement lacking public accountability, particularly as it undermines potential recommendations for corporate governance adjustments. This trial was unique as it was seen as the first serious attempt under Delaware corporate law to hold board members accountable for oversight failures, as claimed by numerous reports including those from Al Jazeera and The Jakarta Post.