Maximilian Klein, et al. v. Meta Platforms, Inc. (user plaintiffs)

Analysis Group was retained by WilmerHale on behalf of Meta, the defendant in a large-scale, high-profile antitrust class action brought by groups of Facebook users and advertisers. The user plaintiffs claimed that Meta misrepresented its data protection practices and failed to impose privacy safeguards in an effort to attract more users to the platform, obtain market power in the alleged social networking services market, and diminish competition. The user plaintiffs claimed antitrust injury by reasoning that, but for Meta’s alleged market power, the company would have had to pay users to use Facebook. The user plaintiffs sought to certify a class consisting of every Facebook user between December 2016 and December 2020, and sought class-wide damages.

An Analysis Group team led by Managing Principal Aaron Yeater and Vice Presidents Ishita Rajani and Carlos Chiapa supported academic affiliate Catherine Tucker of the MIT Sloan School of Management, who filed expert reports and testified at deposition on both class certification and merits issues. Rebutting the plaintiffs’ expert on class certification, she opined that:

• The plaintiffs’ assumption that Meta would compensate Facebook users for using the platform was unsupported by either economics or real-world business practice, and that platforms like Facebook compete on content and feature quality, rather than monetary payments to users.
• The plaintiffs’ expert’s methodology to establish class-wide harm rested on unsupported assumptions and therefore could not reliably show class-wide harm using common methods.

Citing Professor Tucker’s submission in his opinion, Judge James Donato of the US District Court for the Northern District of California denied certification of the user class. In the opinion, Judge Donato noted that the opposing expert “never explains why Meta would focus exclusively on answering new competition by paying users … rather than through innovations in services and product quality. This shortfall goes beyond merely ignoring evidence that Meta in the real world has consistently competed on the basis of quality. ... It goes to the very heart of [the expert’s] theory of antitrust injury to the putative class of users. At the end of the day, it is a conclusion of fiat rather than evidence.”