Federal Trade Commission Faces Lawsuit from Meta to Halt Implementation of New Regulations on Profiting from Children’s Data

Meta is suing the Federal Trade Commission (FTC) to prevent the reopening of a $5 billion privacy settlement from 2020 and to allow it to monetize kids’ data across apps like Facebook, Instagram, and Whatsapp, following a federal judge’s ruling. The ruling will permit the FTC to propose new rules on how the social media giant could operate. The lawsuit demands an immediate stop to the FTC’s proceedings, calling it an “obvious power grab” and an “unconstitutional adjudication by fiat.” This is Meta’s second attempt to stop the sanctions in court.

The FTC says Meta has repeatedly violated the terms of the 2020 settlement regarding user privacy and Children’s Online Privacy Protection Act (COPPA) by monetizing the data of younger users. The agency seeks to restrict this type of monetization and implement new restrictions on Meta’s use of facial recognition, as well as a moratorium on new products and services until a third-party completes an audit to determine if the company’s complying with its privacy obligations.

Samuel Levine, director of the FTC’s Bureau of Consumer Protection, states, “Facebook has repeatedly violated its privacy promises,” adding that the company’s recklessness has put young users at risk. Multiple states and the EU have also sued Meta to stop the monetization of children’s data.

The FTC has been a consistent thorn in Meta’s side, as it tried to stop the company’s acquisition of VR software developer Within and opened up an investigation into the company’s VR arm. The agency is also accused of government overreach by biotech giant Illumina, who is suing the FTC to halt a decision that stops it from a $7 billion acquisition of the cancer detection startup Grail.