A new lawsuit filing alleges that Facebook purposefully inflated the time spent watching videos on its platform by 150 percent to 900 percent to mislead advertisers and inflate advertising rates.
A lawsuit reported on by the Wall Street Journal alleges that Facebook was aware of issues on how the site measured views of video ads for more than a year before it disclosed the issue in 2016. A group of advertisers brought a lawsuit against the social media firm in 2016 for failing to disclose the error earlier, accusing Facebook of engaging in unfair business practices by publishing inaccurate metrics that overestimated how long users spent watching ads and ultimately misled advertisers.
Later, the group of advertisers added a claim of fraud, and in a filing on Tuesday they have now alleged that Facebook knew of the advertising metric bug as early as January 2015 and determined the nature of the miscalculation within months, but failed to disclose this information to advertisers for over a year. The latest filing came shortly after the advertiser’s review of 80,000 pages of internal Facebook records.
“Facebook’s internal efforts behind the scenes reflect a company mentality of reckless indifference toward the accuracy of its metrics,” the advertisers said in Tuesday’s filing. Facebook responded in a statement saying: “Suggestions that we in any way tried to hide this issue from our partners are false. We told our customers about the error when we discovered it — and updated our help center to explain the issue.”
The Wall Street Journal reported:
Facebook told some advertisers that it likely overestimated average time spent watching videos by 60% to 80%. The plaintiffs alleged in Tuesday’s complaint that the error was much larger and that the average viewership metrics had been inflated by some 150% to 900%.
Facebook also said at the time that the error didn’t affect billings. However, in their complaint, the plaintiffs claim Facebook’s misrepresentations “induced” advertisers to purchase video ads and to pay more for Facebook’s video ads because they believed users were watching videos for longer than they actually were on average.
The claims that Facebook failed to act when it discovered the video metric error were in an August filing, but were heavily redacted at the time. In the latest version of the complaint filed Tuesday, those claims were unredacted.
Jason Kint, chief executive of Digital Content Next, a trade organization that represents online publishers, commented on the latest lawsuit brought against Facebook stated: “Facebook needs to lead with radical marketer and consumer transparency to get past this. We haven’t seen it yet.”
The lawsuit against Facebook is ongoing and will be followed closely by Breitbart News