Meta, the owner of Facebook, Instagram, and WhatsApp, has suffered a major setback in a court battle with the US regulator surrounding the privacy of users under the age of 18.
A federal judge ruled on Monday in favour of the Federal Trade Commission (FTC), the leading consumer protection watchdog in the US known for fining Meta billions of dollars for data privacy violations.
The judgement allows the regulator to restrict the amount of money Meta generates from the data of users who are under 18 years of age.
Meta had filed a motion (request) seeking the court’s intervention in its dispute with the FTC. The judge rejected Meta’s request for the court to take up the disagreement and ruled that a regulator can adopt measures that are aimed at limiting Meta’s financial benefits from children across its platforms.
Meta essentially intended to take the dispute away from the FTC and have it dealt with in the court. The company, however, suffered a blow when the court thwarted its attempt to extricate the matter from the regulator’s ambit.
Meta said it would appeal the decision.
The development arrives in the wake of the ban the FTC proposed against Meta’s practices in May 2023. Meta stands accused of violating the 2020 privacy order with the watchdog, misleading parents about the pack of controls it allowed for their children online, and using young users’ personal information for commercial purposes.
The dispute primarily surrounds the Messenger Kids app, with the FTC claiming the app developers were granted permission to harvest confidential data. A statement from the regulator accused Meta of putting young users at risk and called for the tech conglomerate to be held accountable.
The FTC is seeking “blanket prohibition preventing Facebook from monetizing youth data”. Under its proposed changes, Meta would be barred from collecting data of users aged under 18 for commercial objectives such as targeted or behavioural advertising.
The proposed changes would also restrict Meta in its use of facial recognition technology, for which it would have to obtain informed consent. The company would also be required to incorporate additional protective features. Meta’s settlement with the FTC following the Cambridge Analytica privacy fiasco had fetched the company a hefty financial penalty of $5 billion and set of changes it was required to implement across its social media platforms.
