Active Stocks
Sat Mar 02 2024 12:49:58
  1. Tata Steel share price
  2. 155.15 3.43%
  1. HDFC Bank share price
  2. 1,430.35 -0.06%
  1. State Bank Of India share price
  2. 773.05 0.49%
  1. Tata Motors share price
  2. 988.40 1.15%
  1. Wipro share price
  2. 522.65 0.67%
Business News/ Companies / Meta Sues FTC Over Its In-House Courts
BackBack

Meta Sues FTC Over Its In-House Courts

wsj

Suit seeks to block regulator’s restrictions on Facebook owner’s use of data on minors.

Facebook owner Meta says the Federal Trade Commission ‘has a dual role as prosecutor and judge.’Premium
Facebook owner Meta says the Federal Trade Commission ‘has a dual role as prosecutor and judge.’

WASHINGTON—Meta Platforms has challenged the constitutionality of the Federal Trade Commission’s structure, the company’s latest effort to block the regulator from imposing new restrictions on how it can monetize user data.

Meta—which owns Facebook, Instagram, and WhatsApp—sued the FTC on Wednesday in federal court in Washington, alleging “fundamental aspects of the Commission’s structure violate the U.S. Constitution."

Taking issue with the FTC’s use of its in-house courts, Meta argues that in these proceedings the regulator “has a dual role as prosecutor and judge" in violation of due-process guarantees.

Meta is seeking an injunction blocking the FTC from moving forward with new restrictions on the company, first proposed in May, that include a blanket prohibition against monetizing data of children and teens under 18. That provision takes aim at the company’s core business of showing ads to users based on what it learns about their interests.

An FTC spokeswoman declined to comment.

The FTC is seeking to tighten restrictions on Meta by modifying a settlement it reached with the company in 2020. As part of that settlement, Meta agreed to pay a $5 billion civil penalty following a previous FTC investigation into its privacy practices.

“Facebook has repeatedly violated its privacy promises," said Samuel Levine, director of the FTC’s Bureau of Consumer Protection, in a statement at the time. “The company’s recklessness has put young users at risk, and Facebook needs to answer for its failures."

Meta’s lawsuit came two days after a federal judge in Washington said the FTC could move forward with its new limits on Meta by modifying the 2020 settlement. Meta had asked the judge with jurisdiction over the 2020 settlement to block the FTC’s proposed modifications, but the judge said he lacked authority to do so.

The argument Meta makes in its latest lawsuit was foreshadowed by an April decision by the U.S. Supreme Court, Axon Enterprise v. FTC. In that case, the high court said people and businesses subjected to FTC administrative proceedings can seek to enjoin, or block, those proceedings by suing in U.S. District Court and raising constitutional arguments there.

The Supreme Court’s conservative majority has shown skepticism toward the use of administrative courts within federal agencies. During oral arguments in a different case on Wednesday, the justices appeared ready to scale back the Securities and Exchange Commission’s power to enforce securities laws through administrative hearings rather than jury trials.

Write to Jan Wolfe at jan.wolfe@wsj.com

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App

Chat with MintGenie