Meta Platforms Inc META is under scrutiny again about its use of customers’ data after recently unveiled court filings allege the company, as Facebook, entered into a data sharing agreement with Netflix Inc NFLX that allowed the video streaming service access to users’ private messages.
In a court document dated April 14, 2023, the law firm of Klein And Grabert allege that for nearly a decade, starting in 2011, Netflix and Facebook “enjoyed a special relationship” and entered into a series of agreements to share user data.
Benzinga reached out to Meta Platforms for comment on the allegations.
Reed Hastings, who was founder and CEO of Netflix at the time, also sat on Facebook’s board of directors and it was from this position that he was alleged to have leveraged his influence to enter into a series of “Facebook Extended API” agreements.
This allowed Netflix access to Facebook’s users’ private message inboxes, that enabled the company tailor streaming content for its own customers.
Netflix Ad Revenues
Why would Facebook allow such unfettered access? The lawsuit claimed the driving force behind the agreement was advertising revenues.
Netflix was, apparently, spending around $40 million a year on Facebook advertising and, by 2015 had entered into an agreement allowing Netflix data to be used for “targeting/optimization” in Facebook’s ads systems.
In a document released by Facebook in December 2018, it was compelled to address the issue in response to accusations it was disclosing users’ private messages.
“We worked closely with four partners to integrate messaging capabilities into their products so people could message their Facebook friends,” it said.
It continued: “People could message their friends about what they were listening to on Spotify or watching on Netflix, share folders on Dropbox, or get receipts from money transfers through the Royal Bank of Canada app.
“Many news stories imply we were shipping over private messages to partners, which is not correct.”
The court document said lawyers subpoenaed Hastings to provide documents relating to the allegations, but he refused to produce any.
Cambridge Analytica
Facebook’s other indiscretions involving its customers data have mainly been down to information leaks, but in 2018 it was disclosed that for several years, British company Cambridge Analytica had been illegally harvesting Facebook data to be disseminated and used for political campaigns.
Indeed, it later emerged that both Donald Trump and Ted Cruz had used Cambridge Analytica data for targeting potential voters.
The $5 billion imposed by the Federal Trade Commission in July 2019 was one of the largest fines ever handed down by the U.S. government.
Meta is also facing a potentially huge class action lawsuit over allegations it misrepresented the size of its audience for its Facebook and Instagram services.
Advertisers claimed that since 2014 Meta had been inflating ad reach metrics.
Now Read: Meta’s Battle with FTC Thickens, Court Rejects Bid to Stop Privacy Investigation
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