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FACEBOOK TROUBLES GROW – FACING LAWSUIT LIABILITIES OF ... BILLIONS?

30-plus complaints piled up just over Cambridge Analytica

The investor and consumer doubts that sparked a near-20 percent plunge in its market value – some $100 billion plus – isn’t the only concern for the giant web company Facebook these days.

A report at PJMedia outlines the billions in liabilities the company may have because of a number of crises in recent months.

One was the scandal over allowing Cambridge Analytica to breach its users’ privacy and collect data for political purposes.

“The company is facing massive fines and possible government intervention as lawsuits pile up in the U.S. and around the world. In fact, Facebook is facing more than three dozen class-action lawsuits over Cambridge Analytica privacy breaches alone,” the report said. “The looming legal nightmare is so significant that the company felt the need to include a note about it in their quarterly SEC report.”

The company’s stock price hovered around $174 on Friday, down only slightly from where it landed Thursday following its collapse.

At PJMedia, Paula Bolyard noted that the stock collapse happened after the company’s earnings report showed it missed expectations.

The number of monthly users also is “down significantly.”

The company said in its SEC disclosure: “Beginning on March 20, 2018, multiple putative class actions and derivative actions were filed in state and federal courts in the United States and elsewhere against us and certain of our directors and officers alleging violations of securities laws, breach of fiduciary duties, and other causes of action in connection with the misuse of certain data by a developer that shared such data with third parties […] the events surrounding this misuse of data became the subject of U.S. Federal Trade Commission and other government inquiries in the United States, Europe, and other jurisdictions. Any such inquiries could subject us to substantial fines and costs, divert resources and the attention of management from our business, or adversely affect our business.”

Further, PJM reported in May of a possible class-action lawsuit alleging companies are using Facebook’s ad-creation tools to create ads that “discriminate by age.” Facebook, however, is not a defendant in that case.

Also, the report said, a long-time Austrian privacy advocate, Max Schrems, has filed several complaints against Facebook and its other companies, Instagram and WhatsApp.

Then, the report said, there are plaintiffs in California seeking $5 million for Facebook logging users’ texts and calls.

The lawsuits will “continue to chip away at Facebook’s profits and, more importantly, their reputation among rattled users,” the report said.

On Thursday, one analyst called it a “mind-blowing” plunge in company value.

MarketWatch columnist Therese Poletti cited the “stunning disclosure of a revenue deceleration in the second half of this year.”

It started when Chief Financial Officer David Wehner warned that income wasn’t meeting expectations.

Poletti said the steep decline was “stunning not only because of the scale, but because Facebook had managed to avoid this type of punishment through a multitude of sins too numerous to fully list here.”

Its controversies also included a change of algorithms that effectively have censored conservative voices.

One investor on Thursday also revealed a plan to remove founder Mark Zuckerberg as board chairman while maintaining him as CEO.

https://www.wnd.com/2018/07/facebook-troubles-grow-facing-lawsuit-liabilities-of-billions/