Networking giant sued for $15b over user tracking

Los Angeles: Facebook is being sued by users of its social network in an amended class-action case claiming the company invaded their privacy by tracking internet usage and seeking $15 billion (Dh55 billion).

The lawsuit, filed in Federal Court in San Jose, California, combines 21 cases filed across the US, according to a statement by Stewarts Law US LLP, one of the firms leading the claim. It accuses Facebook of improperly tracking users even after they logged out of their accounts.

Facebook has been scrutinised by regulators in the US and Europe over how it protects users' private data. Last year, a German data-protection agency said it may fine the company over facial-recognition software used for tagging photos.

"This is not just a damages action, but a groundbreaking digital-privacy rights case that could have wide and significant legal and business implications," David Straite, a Stewarts Law partner, said in the statement.

Andrew Noyes, a Facebook spokesman, said in a statement that the complaint is "without merit and we will fight it vigorously".

Consolidation

Lawsuits accusing the California-based company of tracking user data, even when they are logged out, have been filed across the US. A California judicial panel ordered in February they be consolidated and heard in the company's home state.

Straite said his firm is evaluating ways to add "non-US residents" to the group of plaintiffs.

The US Wiretap Act "provides statutory damages of the greater of $100 per violation per day, up to $10,000, per Facebook user", according to the lawsuit.

The plaintiffs are therefore "each entitled to the greater of $100 of statutory damages per day, or $10,000 each for the ongoing violations", about $15 billion for all of Facebook's more than 800 million members.

Facebook sold 421.2 million shares, which will trade on the Nasdaq Stock Market, at $38 each to raise $16 billion, it said in a statement yesterday. That values the company at $104.2 billion, or 107 times trailing 12-month earnings, more than every S&P 500 member except Amazon.com and Equity Residential.

Meanwhile, Eduardo Saverin, who fled Brazil as a boy and lived the American dream by helping found Facebook and renounced US citizenship, has drawn ire from US officials.

Two US senators want to make sure he never sets foot in the US again unless he pays tens of millions of dollars in taxes he will owe after the company's initial public offering yesterday.

Saverin renounced his US citizenship this year and is living in Singapore, a country with no capital gains tax. Senators Charles Schumer and Bob Casey, both Democrats, denounced him on Thursday as a tax dodger and introduced legislation to punish anyone who gives up citizenship to duck big tax bills.