In its March 31, 2020 Form 10-Q filed with the SEC, Facebook reported that it was involved in multiple class and derivative actions as well as “various other legal proceedings” which include law enforcement and regulatory inquiries, investigations and other claims that arise in the ordinary course of business. Facebook also acknowledged it “may in the future be subject to additional legal proceedings and disputes” and stressed that it would vigorously defend itself as needed. This may be an understatement because a docket search on the U.S. Supreme Court’s website shows that Facebook has been involved in 27 appeals to the Supreme Court as a litigant or an amicus curiae since 2010. Two of those cases came to fruition – one in favor of Facebook and one against – on May 18, 2018.
In the first case, Stuart Force, et al. v. Facebook, Israeli victims of a Hamas terrorist attack in Israel, sued Facebook in the Eastern District of New York on July 10, 2016, alleging that Facebook unlawfully assisted Hamas by allowing it to post content which encouraged terrorist attacks in Israel. The district court dismissed the action based on §230 of the Communications Decency Act, which protects internet services, like Facebook, from liability based on words used by third parties who use their platforms. On July 31, 2019, the U.S. Court of Appeals for the Second Circuit affirmed, and, on May 18 2020, the Supreme Court denied the plaintiffs’ petition for a writ of certiorari.
Facebook was not so fortunate in the second case – Facebook, Inc., et al. v. Superior Court of San Francisco County. There, the Superior Court of California held Facebook and Twitter in contempt and fined them each $1,000 for refusing to disclose their account holders’ electronic communications in response to a subpoena from two criminal defendants. Even though the social media services argued that complying with subpoenas would violate the Stored Communications Act, which relates to the disclosure of stored wire and electronic communications and transactional records held by third-party internet service providers, the court still ordered production of the documents and issued contempt sanctions and fines when the social media sites refused to comply. The California Court of Appeal ultimately vacated the production order, but did not vacate the contempt order. California’s Supreme Court rejected the petition for review so the two social media platforms filed a writ for a petition of certiorari with the U.S. Supreme Court on February 7, 2020, seeking to overturn the contempt findings and $1,000 fines. The Court denied the petition for certiorari on May 18.
These two cases confirm that Facebook, whether as a plaintiff or defendant, takes litigation seriously regardless of the issue or amount in dispute. The cases also demonstrate that litigants who take on the social media giant should be prepared for both a costly legal battle and being in it for “the long haul.”
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For any question relating to this article, please contact Robert B. Nussbaum, Esq. at Saiber LLC.