Meta sues FTC to block new restrictions on monetizing kids’ data

It also seeks to prevent the agency from revisiting the $5 billion privacy settlement from 2020.


Meta has sued the Federal Trade Commission (FTC) in an attempt to stop regulators from reopening a landmark $5 billion privacy settlement from 2020 and to allow it to monetize kids’ data across apps like Facebook, Instagram and Whatsapp. This comes after a federal judge ruled on Monday that the FTC would be allowed to expand on 2020’s privacy settlement, paving the way for the agency to propose tough new rules on how the social media giant could operate in the wake of the Cambridge Analytica scandal.

Today’s lawsuit demands an immediate stop to the FTC’s proceedings, calling it an “obvious power grab” and an “unconstitutional adjudication by fiat.” A Meta spokesperson even referred to the FTC as “prosecutor, judge, and jury in the same case”, as reported by Bloomberg. This is the second attempt by Facebook’s parent company to stop the sanctions in court.

The FTC, for its part, says that Meta has repeatedly violated the terms of 2020’s settlement regarding user privacy. The agency also says that the company has violated the Children’s Online Privacy Protection Act (COPPA) by monetizing the data of younger users. The FTC has already been given the go ahead by a judge to restrict this type of monetization, a decision Meta hopes to overturn.

The FTC also seeks to implement new restrictions that limit Meta’s use of facial recognition, as well as a complete moratorium on new products and services until a third-party completes an audit to determine if the company’s complying with its privacy obligations.

“Facebook has repeatedly violated its privacy promises,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in a statement. “The company’s recklessness has put young users at risk, and Facebook needs to answer for its failures.” To that end, multiple states have sued Meta to stop the monetization of children’s data, along with the EU.

The FTC has been a consistent thorn in Meta’s side, as the agency tried to stop the company’s acquisition of VR software developer Within on the grounds that the deal would deter "future innovation and competitive rivalry." The agency dropped this bid after a series of legal setbacks. It also opened up an investigation into the company’s VR arm, accusing Meta of anti-competitive behavior.

Corporations have been all over the FTC lately in attempts to paint the agency as a prime example of government overreach. Beyond Meta, biotech giant Illumina is suing the FTC to halt a decision that stops it from a $7 billion acquisition of the cancer detection startup Grail.