Facebook, now Meta, accused of securities fraud by the Ohio Pension Fund

  • Ohio’s Attorney General is suing Meta, claiming it misled the public and cost investors billions.
  • The case says the company violated federal securities laws by failing to disclose its harm to young users.
  • Lawsuits like this continue to pose a greater risk to Meta than potential congressional regulation.

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Ohio’s attorney general on Monday filed a lawsuit against Meta, formerly known as Facebook, accusing the company of violating federal securities laws by failing to disclose internal research on the harmful effects of their platforms on children to investors.

The lawsuit was filed on behalf of the Ohio Public Employees Retirement System and Facebook investors, who together lost more than $ 100 billion in market share since whistleblower employee Frances Haugen first leaked internal documents to the Wall Street Journal, AG David said. Yost.

“Facebook said it was taking care of our kids and weeding out online trolls, but in reality, it created misery and division for profit,” Yost said in a press release. “We are not human for Mark Zuckerberg, we are the product, and we are being used against each other by greed.”

Yost said in the press release that he hopes to recover the pension fund’s losses with the lawsuit as well as ensure that the company “makes significant reforms” to avoid misleading the public again.

A Facebook representative said: “This case is unjustified and we will defend ourselves vigorously.”

Monday’s filing is likely the first major lawsuit against the company since Haugen first leaked thousands of internal discussions, notes and research to federal regulators and the media. Among the amount of materials are cases where Facebook knew its products were unhealthy and potentially dangerous to teenage users, but undermined efforts to counteract this harm.

Haugen testified before the congress that the company chooses “profits over security.”

The company has maintained that the documents do not paint a complete picture of Meta and its security efforts. Its share price has fallen about 9% since the first “Facebook Papers” reports began to be published in September.

Monday’s trial is also among the first in what experts say is likely to be a barrage of lawsuits against Meta. Analyst Blair Levin told Insider in October that class actions – like the handful already filed – and investigations led by state attorneys like Yost could be more serious threats than any new federal regulation from Congress.

This is because the court could force Meta to publish more internal documents, which could “provide even more problematic evidence for Facebook,” Levin said.

Yost was previously one of 40 state attorneys who wrote a letter to CEO Mark Zuckerberg in May pleading with the company to scrap plans to roll out an Instagram version for children.

Instagram claimed that the child-centered app would allow parents to better monitor and control their children’s experiences. But referring to the setback, Instagram said in September that it stopped plans for it.

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