Facebook Sues US, UK App Developers Over Data Theft, Fake Engagement Services

Facebook Inc FB is pursuing lawsuits against certain app developers for infringement and violation of terms of service, the company's director of platform enforcement and litigation, Jessica Romera, announced Thursday. 

What Happened: The social media platform said it has filed a lawsuit against MobiBurn, OakSmart Technologies, and the latter's founder Faith Haltas in the High Court of Justice in the United Kingdom.

The social media company is seeking an audit and an injunction against an app developer.

The Mark Zuckerberg-led company said it had earlier approached the plaintiff with an audit request after realizing that user data was collected through its platform. This event was flagged by security researches as a part of FB’s data abuse bounty program.

Reportedly, MobiBurn colluded with developers and paid them to install malicious Software Development Kits (SDK) in their apps. Once these SDKs were loaded in the user’s devices it requested access to data from their Facebook profiles. This compromised personal data like the name, email address, time zone, and gender.

Facebook said it filed a separate lawsuit in the United States against one Nikolay Holper for "operating a fake engagement service known as Nakrutka."

According to the company, Holper sold fake engagement services to the users of its subsidiary Instagram's platform, including fake likes, comments, views and followers.

Why Does It Matter:

Social media platforms are facing flak from regulators both in the U.S. and Europe regarding data privacy issues.

In the past, Facebook was fined a record-breaking $5 billion penalty by the FTC for violating federal law related to data privacy and data protection. In May 2020, BBC reported that Facebook was fined $6.5 million in Canada for sharing user data third-party developers.

The decision by Facebook to take action against MobiBurn would not only protect the company from the regulators but also safeguard the platform users from data theft.

Price Movement:

Facebook stock dropped 3.52% during the trading hours on Thursday and continued to drop further 0.33% to close at $292.25 in the after-market trading session.