Judge dismisses suit against Facebook over iOS privacy settings

Apple's introduction of App Tracking Transparency (ATT) in 2021 immediately hurt social media income. Ultimately, Meta said that Facebook alone would earn $10 billion less in 2022 than expected, solely because of Apple's then-new privacy settings in iOS.

Now according to Reuters, a lawsuit was brought against Meta by shareholders over the issue. The suit alleged that Meta had defrauded shareholders by concealing the extent of how ATT would affect advertising.

US District Judge Yvonne Gonzalez Rogers ruled that Facebook's admission of the $10 billion "headwind" against advertisers did not prove that prior disclosures were false. Judge Rogers has dismissed the suit with prejudice, so it cannot be brought again.

The shareholder suit led by four Israeli insurers and pension funds was chiefly based on a series of allegedly false or misleading statements made by Meta during 2021 and 2022. According to the suit, Meta's stock price dropped 53% in under a year because of ATT.

As part of the same case, the shareholders also maintained that Facebook knew its Reels feature would reduce advertising. Further, they claimed that former Meta Chief Operating Officer Sheryl Sandberg used company resources on personal matters.

Regarding these allegations, Judge Rogers said they were unproven. "The court determines plaintiffs have not plausibly alleged violations of federal securities law," she wrote in her filing.

Separately, in 2021 it was reported that firms including Facebook were attempting to exploit a loophole in the guidelines regarding App Tracking Transparency.