11 votes

Facebook paid FTC $4.9B more than required to shield Mark Zuckerberg, lawsuit alleges

5 comments

  1. joplin
    Link
    This is damning of both Facebook and the FTC, if true.

    This is damning of both Facebook and the FTC, if true.

    11 votes
  2. AugustusFerdinand
    Link
    I can't find any good info on correlation between number of users and total fine, but it feels like the 50M users involved and a mere $104,751,390 fine that the lawsuit alleges doesn't jive....

    I can't find any good info on correlation between number of users and total fine, but it feels like the 50M users involved and a mere $104,751,390 fine that the lawsuit alleges doesn't jive. Anyone know how they came up with $2.09 per user being the appropriate fine?

    7 votes
  3. [3]
    skybrian
    Link
    It's a bit odd that, if they win the lawsuits or settle them, the remedy for Facebook's leaders doing bad things will be that some of Facebook's shareholders get more money. (As well as the...

    It's a bit odd that, if they win the lawsuits or settle them, the remedy for Facebook's leaders doing bad things will be that some of Facebook's shareholders get more money. (As well as the lawyers.)

    Particularly since Facebook's stock went up quite a bit since then.

    This is true of a lot of shareholder lawsuits. Matt Levine writes about it sometimes. Maybe he will write about Facebook?

    4 votes
    1. [2]
      joplin
      Link Parent
      That’s an … interesting… way to look at it. Another way is that the shareholders invested in the company based on how the business had been run up to that point and discovered that some of it was...

      That’s an … interesting… way to look at it. Another way is that the shareholders invested in the company based on how the business had been run up to that point and discovered that some of it was fraudulent, thus potentially increasing their risk without them being informed about it. The shareholders didn’t do the bad thing, and the company will end up being punished for it if they win. Why should shareholders who have no insight into the underhanded dealings of the CEO be punished for what the CEO did? I’m not saying the shareholders are in the right here or that I agree with them, but I also don’t follow your logic. The shareholders seem to feel they were deceived, so it seems natural to try to hold the company accountable so it doesn’t happen again. Another way would be for them to sell their shares, but presumably they think things are salvageable and they’d be better off sticking it out. Or they don’t think they could get enough shareholders to sell to make a difference and a suit is more effective.

      (For the record I’m not aware of holding any Facebook stock myself other than through mutual funds I have that track the entire market. I generally despise the company.)

      5 votes
      1. skybrian
        Link Parent
        It's just weird how it works out sometimes. The people who hate Facebook don't hate it for defrauding shareholders. If the stock dropped they would probably be happy? If Facebook paid a few...

        It's just weird how it works out sometimes. The people who hate Facebook don't hate it for defrauding shareholders. If the stock dropped they would probably be happy? If Facebook paid a few billion more in taxes they would probably be happy with that too.

        It's sort of like Al Capone going to jail for tax evasion.

        2 votes