Facebook wins the rejection of a lawsuit filed by an investor for violation of his privacy

By Brendan Pierson

<p class = "canvas-atom-canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "NEW YORK (Reuters) – Facebook Inc and its chief executive Mark Zuckerberg on Thursday, February 1, 2009, at 9:00 pm "23"> NEW YORK (Reuters) – Facebook inc. and its CEO, Mark Zuckerberg, on Thursday denied a lawsuit filed by an investor accusing them of misleading investors about the likely impact of a breach of privacy on the stock price, well investors have the opportunity to submit a new file.

US Judge Edward Davila, of the US District, San Jose, California, said investors had not claimed that Facebook or its officers had knowingly made false statements resulting in the loss of investors.

Facebook and investor lawyers could not be contacted immediately for comment.

The class action, consolidated following several investor complaints filed last year, also targeted Facebook CEO Sheryl Sandberg and Chief Financial Officer David Wehner.

Investors are focusing on a breach of privacy, reported for the first time in December 2015, which allowed Cambridge Analytica, a British political advisory firm, to access data from some 87 million people. Facebook users.

In March 2018, several media reported that Facebook was still allowing third parties to access user data and that the Cambridge Analytica violation data had been used as part of President Donald Trump's campaign. The reports resulted in a fall of more than 18% in the stock price of the company in two weeks.

In July 2018, Facebook's share price fell again by almost 19%, immediately after the company revealed in its quarterly results that growth in the number of active users was slowing and that total revenue was declining .

Investors claimed in their lawsuit that Facebook and its executives had made dozens of statements downplaying the effect that the Cambridge Analytica leak and user privacy issues could have on the stock price.

Davila, however, said Thursday that they had failed to identify specific instances of the company or its officers knowingly making false claims. He noted that some were forward-looking forecasts and others were general expressions of optimism, which generally can not be the basis of securities fraud prosecutions.

The judge gave investors until October 26 the right to file a new version of their complaint, saying that it was "possible for plaintiffs to remedy their allegations by alleging, inter alia, more precise explanation as to why the statements of the accused were false. "

Facebook is currently facing a national dispute involving users seeking to hold the company accountable for various federal and state laws for allowing third parties, including Cambrdige Analytica, to access their data.

(Report by Brendan Pierson in New York, additional report by Jonathan Stempel, edited by David Gregorio)