When Facebook finally settled with the Federal Trade Commission (FTC) over the Cambridge Analytica data breach scandal, its $5 billion fine went down as the largest in history. However, two groups of Facebook shareholders are now claiming that the social media giant dramatically overpaid in order to protect CEO and founder Mark Zuckerberg from being held personally liable for the data scandal.
According to the shareholders, Facebook’s “maximum monetary exposure” was about $105 million. So why then did the company agree to pay $4.9 billion more than that? The lawsuits claim it was to protect Zuckerberg, Facebook COO Sheryl Sandberg and other company leaders from deposition and further government scrutiny.
“Zuckerberg, Sandberg, and other Facebook directors agreed to authorize a multi-billion settlement with the FTC as an express quid pro quo to protect Zuckerberg from being named in the FTC’s complaint, made subject to personal liability, or even required to sit for a deposition,” according to the lawsuit.
Of course, shareholders are only filing these suits in order to be compensated for the money that the company gave away to protect its leaders. But no matter the suits’ motives, it exposes a troubling truth about Facebook: that it will do anything to protect its own from consequences.
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