Federal Court grants approval for ACCC to go ahead with Facebook lawsuit

The social media network has been accused of using users' personal activity data for commercial benefit without consent.

The Australian Competition and Consumer Commission (ACCC) has been granted legal approval to continue ahead with its lawsuit against Facebook and a pair of its subsidiaries regarding its use of users' personal activity.

On Thursday, the Australian Federal Court granted approval for the consumer watchdog to serve the lawsuits to the companies despite them being based in the United States and Israel.

The ACCC commenced proceedings in December last year, accusing the social media giant and its subsidiary Onavo Protect Services of utilising Facebook's servers to collect significant personal activity data, including about users' internet and app activity, for commercial benefit, including to support market analytics and related activities such as identifying future acquisitions.

In making this accusation, the consumer watchdog claimed Facebook and its subsidiaries misled Australian consumers by representing that the Onavo Protect app would keep users' personal activity data private, protected and secret, and the data would not be used for any purpose other than providing Onavo Protect's products.

Onavo was purchased by Facebook in 2013. Five years after its acquisition, the Onavo app was pulled from Apple's app store in 2018, after the Cupertino company asked for the app to be voluntarily pulled.

The ACCC pointed to ads at the time that said data would be kept "secret" and "safe".

Beyond the lawsuit, the ACCC and Facebook recently locked horns in relation to Australia's News Media and Digital Platforms Mandatory Bargaining Code, which led to Facebook temporarily pulling the news sharing function from its platform.

This tension was eventually resolved, with Facebook agreeing to fund media businesses in Australia for displaying links to articles.

Since then, Facebook has made deals with various Australian media businesses, with ACCC chair Rod Sims saying last week he was happy for the social media giant to take its time in making the deals.

"I'm happy to give it a bit more time and therefore not do anything at the moment," he told the Environment and Communications References Committee last week, during its hearing on media diversity in Australia. 

"The way I see that is, the purpose of the media bargaining code was to improve the bargaining power of the news media businesses with Facebook and Google. I think the news media bargaining code has done that."

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