Facebook's $5 Billion Deal With FTC to End Privacy Probe Gets Court Approval

Mark Zuckerberg - Getty - H 2019
MANDEL NGAN/AFP via Getty Images

A DC federal judge has signed off on the U.S. government's $5 billion deal with Facebook to resolve an investigation into the social media giant's privacy practices.

The Federal Trade Commission announced the fine a year ago. It represented the largest monetary punishment in FTC history and came as Facebook continues to face fire over the way that third parties have been allowed to access and use data as exemplified by the Cambridge Analytica scandal. To end an investigation by the FTC for a second time in the past decade, Facebook also agreed to establish an independent privacy committee of Facebook’s board of directors.

While sounding impressive, the deal came under fire from several public interest groups including Public Citizen, Common Sense Media and the United States Public Interest Research Group, who attempted to intervene upon the consent agreement being submitted in court. They expressed concern that the proposed decree offered Facebook "broad immunity" from any further government claim concerning the social media company's unfair or deceptive consumer practices. 

"In the Court's view, the unscrupulous way in which the United States alleges Facebook violated both the law and the administrative order is stunning," writes U.S. District Court Judge Timothy J. Kelly in his memorandum opinion. "And these allegations, and the briefs of some amici, call into question the adequacy of laws governing how technology companies that collect and monetize Americans' personal information must treat that information."

But Kelly then adds, "[T]hose concerns are largely for Congress; they are not relevant here. Mindful of its proper role, and especially considering the deference to which the Executive's enforcement discretion is entitled, the Court will grant the consent motion and enter the order as proposed."

Responding specifically to the argument that the scope of the liability release offered to Facebook is "unprecedented" and will preclude the FTC from bringing other enforcement actions based on complaints, the court's opinion states "the admittedly broad scope of the release does not mean that the settlement is not in the public interest. As the United States explains, the Stipulated Order does not stop the FTC from bringing new enforcement actions against Facebook should it learn of additional violations of Section 5 of the FTC Act, even if those violations occurred before July 12, 2019."

Here's the full opinion.