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Facebook’s Record $5B FTC Settlement Wins Court Approval

April 24, 2020, 5:07 PM

Facebook Inc.'s record $5 billion settlement with the Federal Trade Commission over data-sharing practices won court approval in Washington.

The settlement, approved by the U.S. District Court for the District of Columbia, ends allegations that Facebook violated consumer protection laws and an earlier consent agreement with the agency in the Cambridge Analytica data scandal.

The court retains jurisdiction over the consent decree and may not agree to a similar agreement if future allegations arise, Judge Timothy Kelly wrote.

The claims and briefs “call into question the adequacy of laws governing how technology companies that collect and monetize Americans’ personal information must treat that information,” Kelly wrote.

The settlement will force Facebook to consider privacy throughout its operations and improve transparency and accountability of privacy-related decisions, FTC Chairman Joseph Simons said in an emailed statement.

The allegations stemmed from Facebook’s role in the Cambridge Analytica matter. The British consultancy hired by President Donald Trump’s 2016 presidential campaign improperly obtained data on tens of millions of Facebook users through an academic researcher.

Michel Protti, Facebook’s chief privacy officer, wrote in a blog post that the agreement has been a catalyst for changing the company’s culture. “It brings a new level of accountability and ensures that privacy is everyone’s responsibility,” he wrote.

Protti also said he hopes the agreement leads to legislation “in the U.S. and elsewhere.”

Facebook faces ongoing scrutiny for its data practices stemming from the scandal.

State enforcers, District of Columbia Attorney General Karl Racine (D), Massachusetts Attorney General Maura Healey (D) and Cook County, Ill. prosecutors have brought actions.

The case is United States v. Facebook, Inc., D.D.C., No. 19-cv-02184, opinion 4/23/20.

To contact the reporter on this story: Daniel R. Stoller in Washington at dstoller@bloomberglaw.com

To contact the editor responsible for this story: John Hughes at jhughes@bloomberglaw.com; Keith Perine at kperine@bloomberglaw.com

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