Meta Platforms, Inc.

Investigation
02/02/2022

Initial Lawsuit
03/08/2022

Lawsuit Progression
06/06/2022

Investigation

Continous Holding
March 2, 2021 to February 2, 2022
Proposed Claim
Securities Violation

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.

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.