A lawsuit claiming that Facebook's parent company Meta concealed the impact of Apple's iOS privacy settings on advertisers has been dismissed. Apple's introduction of "App Tracking Transparency" (ATT) in 2021 immediately affected social media revenue, and Meta previously stated that Facebook alone would earn $10 billion less in 2022 due to Apple's privacy settings.
According to Reuters, shareholders filed a lawsuit against Meta, accusing the company of deceiving them by hiding the impact of ATT on advertising. U.S. District Judge Yvonne Gonzalez Rogers ruled that Facebook’s earlier disclosure of a "$10 billion headwind" did not prove previous statements were false. As a result, the lawsuit was dismissed with prejudice, meaning it cannot be refiled.
The lawsuit, led by four Israeli insurers and pension funds, was primarily based on a series of allegedly false or misleading statements made by Meta in 2021 and 2022. The shareholders claimed Meta’s stock price dropped 53% within a year because of ATT.
Additionally, the shareholders alleged that Meta knew its Reels feature would reduce advertising revenue and accused former Chief Operating Officer Sheryl Sandberg of using company resources for personal matters. However, Judge Rogers stated that these claims were unproven, writing, "The court finds that plaintiffs have not plausibly alleged violations of federal securities laws."
Separately, in 2021, it was reported that companies like Facebook attempted to exploit loopholes in the guidelines surrounding App Tracking Transparency.