Facebook’s parent company, Meta, has struck a $50 million deal with the Australian Information Commissioner to settle a Federal Court case over privacy breach involving the Cambridge Analytica political scandal.
While it’s the second largest settlement struck by Meta over the matter, its a fraction of the US$725 million (A$1.14bn) the tech giant paid to settle its US case. On a population pro rata basis, Meta’s Australian settlement would have been closer to A$91 million to equal the American figure.
Meta fought the case all the way to the High Court in a four-year legal battle.
The $50 million will be offered as compensation to people in Australia between 2 November, 2013, and 17 December, 2015, who either installed the This is Your Digital Life app, or were Facebook friends with someone who did.
Payments will be based firstly on generalised concern or embarrassment, or a second higher amount if the victim can demonstrate specific loss or damage. The compensation program is expected to involve more than 300,000 local Facebook users. The third-party administrator will run an internal review avenue for people involved.
The Office of the Australian Information Commissioner (OAIC) said it anticipates applying to the payment program will begin in the second quarter of 2025.
The OAIC began legal action against Meta in 2020, alleging that personal information of some Australian Facebook users was disclosed to the This is Your Digital Life app in breach of the Privacy Act.
Most of the victims did not install the app – it was disclosed via their friends’ use of the app. 53 Australians downloaded the This Is Your Digital Life app, but its reach into the lives of people they were connected to via Facebook involved 311,074 Australian users among the 86.3 million people caught up in the global data scraping scandal.
That data was then passed on to the now defunct British political consulting firm Cambridge Analytica, which used it for political purposes, including on behalf of the Republicans during the 2016 US presidential election won by Donald Trump. Cambridge Analytica also claimed to have influenced more than 200 elections globally.
The matter went all the way to a High Court in an appeal by Meta last year as the tech platform tried to duck responsibility by claiming it didn’t operate in Australia.
Meta lost that appeal, which argued that Facebook’s actions weren’t covered by the section of the Privacy Act that says an international organisation must have an “Australian link”, which is determined by if it “carries on business in Australia”.
The matter subsequently went to court-ordered mediation, which has been ongoing since February this year as part of the Federal Court case.
Case closed
The $50 million payment by Meta Platforms, Inc. to settle the legal action is part of enforceable undertaking. The Commissioner has withdrawn its Federal Court civil penalty proceedings as part of the deal, which involved no admissions of Meta’s part.
Australian Information Commissioner Elizabeth Tydd said the settlement is the largest-ever payment addressing concerns about the privacy of Australians.
“It represents a substantive resolution of privacy concerns raised by the Cambridge Analytica matter, gives potentially affected Australians an opportunity to seek redress through Meta’s payment program, and brings to an end a lengthy court process,” she said.
“The payment scheme is a significant amount that demonstrates that all entities operating in Australia must be transparent and accountable in the way they handle personal information, in accordance with their obligations under Australian privacy law, and give users reasonable choice and control about how their personal information is used.
“This also applies to global corporations that operate here. Australians need assurance that whenever they provide their personal information to an organisation, they are protected by the Privacy Act wherever that information goes.”
Any residual funds not exhausted in the payment scheme will be paid into the Commonwealth’s Consolidated Revenue Fund. Meta also paid a contribution to the Commissioner’s legal costs.
Since the legal action began four years ago, the Federal Court penalties for privacy breaches have increased from $1.7 million each to whichever is the greater of $50 million, three times the value of any benefit obtained through the misuse of information, or 30% of a company’s adjusted turnover in the relevant period.
Any leftover funds from the payment scheme will be paid into the Commonwealth’s Consolidated Revenue Fund. Meta also paid a contribution to the Commissioner’s legal costs.
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