The social networking giant has been facing a class action
lawsuit since 2018. The plaintiffs claim that the platform's managers knew that
its so-called "Potential Reach" measure was inflated, but did not
seek to rectify the situation so as not to lose revenue.
The California company derives the overwhelming majority of
its revenue from the sale of targeted advertising. Prices vary according to
many criteria, starting with the number of users likely to see the campaign.
"Facebook knew for years its Potential Reach was
inflated and misleading," lawyers in the class action suit contended in
the filing.
The suit argued that Facebook made a deliberate decision not
to remove duplicate or fake accounts from the Potential Reach tool metrics.
And the legal documents cited a Potential Reach product
manager who wrote in an internal email: "it's revenue we should have never
made given the fact it's based on wrong data."
The internet giant contended that a Potential Reach estimate
feature at issue in the suit was merely a "free tool" advertisers had
the option of looking at and did not affect delivery of ads, according to court
documents.
The Potential Reach tool lets advertisers put in budget and
other criteria into a software program and be given an estimate of how many
people they could reach on the Facebook platform.
"Facebook did not merely 'drag its feet' in providing
inaccurate and misleading Potential Reach. Rather, Facebook knew for years its
Potential Reach was misleading, and concealed that fact to preserve its own
bottom line," plaintiffs' attorneys argued in a February 10 filing.
Facebook did not reply to an request for comment. The suit
was filed about two years ago, and Facebook has since modified the Potential
Reach tool.
Lawyers representing plaintiffs in the case called on a
federal court in San Francisco to reject a request by Facebook that the
two-year-old litigation be dismissed.
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