Meta Platforms, Inc. Image 2022
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Meta Platforms, Inc.

Class Action
  • Active
Investigation
02/02/2022
Initial Lawsuit
03/08/2022
Lawsuit Progression
06/06/2022

Investigation

Did Meta mislead investors/shareholders regarding mitigation efforts to counteract Apple’s new privacy protections and the growing TikTok competitiveness?

This post is open for investors to gather facts, and findings and track their exposure to related lawsuits. We invite investors and shareholders to contribute to this investigation for their own benefit, add events to the factual timeline below and vote on events’ pertinence.

A lawsuit was subsequently filed. We will update this post as it unfolds.

  • Investigation Date
    02/02/2022
  • Hypothetical Affected Period
    March 2, 2021 to February 2, 2022
  • Hypothetical Transgression
    Securities Violation
Main Event

First Decline in MAUs

02/02/2022

SEC Filing

Meta Platforms reports its Q4 and fiscal year 2021 financial results, with earnings estimates for the fourth quarter at $3.67 vs. $3.84 analysts expectation. Meta disclosed a revenue forecast of $27 billion to $29 billion for the first quarter, below analyst expectations of $30.15 billion (Refinitiv source).

“We had a solid quarter as people turned to our products to stay connected and businesses continued to use our services to grow,” said Mark Zuckerberg, Meta founder and CEO. “I’m encouraged by the progress we made this past year in a number of important growth areas like Reels, commerce, and virtual reality, and we’ll continue investing in these and other key priorities in 2022 as we work towards building the metaverse.“

The stock impact compares the closing price immediately preceding the date of the event and the following closing price. The price difference also reflects the overall mix of information.

Stock Impact

Close Previous close Price variation Percentage variation
$237.76 $323 $-85.24 -26.39%
See more on Factual Timeline

Initial Lawsuit

First Complaint - 03/08/2022

A shareholder brought this securities class action on behalf of all persons or entities who purchased or otherwise acquired Meta securities between March 2, 2021 and February 2, 2022, inclusive.

  • Filing Date
    03/08/2022
  • Class Period
    03/02/2021 to 02/02/2022
  • Transgression
    Securities Violation
  • Filing Firms
    Labaton Sucharow LLP
    Wagstaffe, Von Loewenfeldt, Busch & Radwick LLP
  • Case Title
    Plumbers and Steamfitters Local 60 Pension Trust v. Meta Platforms, Inc. et al
  • Docket Number
    4:22-cv-01470
  • Court
    California Northern District Court
  • Free File
    Complaint

Allegations

According to the complaint, defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business, operations, and prospects. Specifically, defendants allegedly failed to disclose to investors:

(i) that throughout the class period, which spans from March 2021 (shortly before the Apple changes went into effect) to February 2022, defendants—including the most senior echelon of Meta’s upper management— misled investors about mitigation efforts that Meta was implementing to try and counteract the devastating impacts to Meta’s advertising business from Apple’s new privacy protections;
(ii) that Meta’s mitigation efforts were not adequately mitigating the headwinds to advertising revenue caused by the new privacy protections or otherwise making the iOS changes “manageable” for Meta’s advertising business;
(iii) by what order the order of magnitude the changes would hurt the ad business until February 2, 2022, when they admitted to a staggering $10 billion impact on revenue; and
(iv) that it was facing materially increasing competition from rival social media platform TikTok, causing Meta to steer users from its services like “Stories” to its “Reels” service.

Defendants

  • Company
    Meta Platforms, Inc.
  • Chief Executive Officer
    Mark Zuckerberg
  • Chief Financial Officer
    David Wehner
  • Chief (Other)
    Sheryl Sandberg
  • Vice President
    Susan Li is

Lawsuit progression

  • Docket Number
    4:22-cv-01470
  • Court
    California Northern District Court

Lead Counsel

06/06/2022

The court issued an order appointing the lead plaintiff and lead counsel.

Factual Timeline

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