Mark Zuckerberg and several top Meta executives have agreed to a legal settlement in a shareholder lawsuit seeking over $8 billion in damages over Facebook’s historical privacy breaches, including the infamous Cambridge Analytica data scandal.
The lawsuit, filed in 2018, accused Zuckerberg and other current and former board members of breaching their fiduciary duties by failing to prevent repeated privacy violations that exposed Meta Platforms Inc. (formerly Facebook Inc.) to massive regulatory fines and public backlash.
The settlement was disclosed Thursday in Delaware’s Court of Chancery, just before the high-stakes trial was set to enter its second day. Lawyers for the plaintiffs, a group of Meta shareholders, announced the deal, but did not disclose the amount agreed upon. Meta declined to comment, and terms of the settlement are expected to be filed under seal, pending court approval.
$8 Billion Claim Rooted in Facebook’s Privacy Breaches
The shareholders had sought over $8 billion in damages, arguing that Meta’s leadership was responsible for poor governance that led to repeated violations of users’ privacy rights — most notably the Cambridge Analytica scandal, where data from tens of millions of Facebook users was improperly accessed and used by a political consulting firm that worked on Donald Trump’s 2016 presidential campaign.
According to the plaintiffs, the fallout from privacy violations cost Meta billions in regulatory fines, legal expenses, and reputational damage. They argued that Zuckerberg and other directors — including high-profile figures like Netflix co-founder Reed Hastings, Palantir’s Peter Thiel, and former Meta COO Sheryl Sandberg — had failed to exercise proper oversight and were partially responsible for the mismanagement.
The lawsuit also raised concerns over the timing of share sales by Meta executives, implying that some leaders may have profited from insider knowledge before major public disclosures about the company’s legal troubles.
High-Profile Trial Cut Short
Among the named defendants was Jeffrey Zients, a former Meta board member who later served as U.S. President Joe Biden’s White House Chief of Staff. In testimony on Wednesday, Zients admitted that Meta’s $5 billion fine from the Federal Trade Commission (FTC) was “substantial,” but denied that the company paid it to shield Zuckerberg from personal legal exposure.
The trial was expected to continue for several days, with former COO Sheryl Sandberg among the top executives scheduled to testify under oath. But the sudden settlement means key figures in Meta’s leadership — past and present — will avoid giving live courtroom testimony, a move that critics say denies the public a fuller understanding of how systemic privacy failures were allowed to persist for years.
“This trial could have revealed how Facebook internalized and approved potentially illegal data practices,” said Ann Lipton, a corporate law professor at the University of Colorado. “Now, we won’t get that accounting — and that’s a loss for transparency and accountability.”
Meta Not a Direct Defendant, But Under Scrutiny
Though Meta itself was not a direct defendant in the case, the outcome affects the company’s public image and could influence future shareholder litigation. The tech giant has maintained that it has invested heavily in privacy reforms since the Cambridge Analytica scandal became public, spending billions of dollars on data protection and transparency measures since 2019.
The trial was overseen by Chancellor Kathaleen McCormick, who previously made headlines for rejecting Tesla CEO Elon Musk’s $56 billion pay package in 2023. Her rulings have turned Delaware’s business courts into a key battleground for corporate governance and executive accountability.
Broader Implications for Tech Industry Governance
This high-profile settlement adds to growing concerns about executive oversight and data ethics in Big Tech. It also follows increasing scrutiny from regulators in the U.S. and Europe, who continue to investigate Meta over content moderation, user tracking, and algorithmic transparency.
Meta — parent to Facebook, Instagram, and WhatsApp — remains one of the world’s largest and most influential tech companies. Despite recent pushback over privacy and AI governance, the company continues to expand into emerging technologies such as virtual reality and the metaverse.
For now, shareholders will not get their day in court, and the public will be left without a full airing of how one of the largest privacy breaches in tech history unfolded under Zuckerberg’s leadership.
