what a week for Facebook, Attorney General Racine's complaint just posted to the docket with Mark Zuckerberg now added as a defendant. This was widely reported last week but interesting to see (and not see). /1
By "not see," I mean there is a ton of redactions specific to Zuckerberg presumably tied to the limited discovery they've been able to do so far. As part of this, DC will increase its press to depose and do discovery on Zuckerberg, something FTC failed to do. /2
It seems something was more recently discovered that increased their interest in going for the king. /3
A reminder on the case, it involves a cover-up that involved misleading the public, the press and political leaders. None of this is in doubt at this point, it's really a matter of being able to complete discovery and get to the courts vs settle which Facebook will aim to do. /4
The core case in the cover-up was the Cambridge Analytica scandal which the AG complaint reminds involved allowing CA to use the Facebook platform to influence and manipulate the 2016 presidential election despite knowing they had improperly purchased Facebook data. /5
And yes, that data was *sold* to Cambridge Analytica. AG describes it accurately in the complaint. I reiterate this as last night @profcarroll was sharing frustration in the press re-writing history by softening from the term "sale" which I entirely agree is a problem. /6
Here is the AG @AGKarlRacine on CNN last week discussing adding Zuckerberg to the lawsuit. /7
That's all on this one. It also relates to the FTC lawsuit and a few complaints filed in Delaware which were able to get hold of communications between the board and Facebook leadership. More down these threads... /8
Day 2. A few comments after 2nd day of testimony from Mark Zuckerberg. FTC began with impeachment as Zuckerberg had said yesterday friends & family were only about 25% of Stories shared when instead it appears more in 63-73% range. I would hammer him on these, it's a pattern. /1
Remember, we've learned from MZ's deposition to SEC and many trips to Congress, he may say too much and seems to talk his way through problems. Speaking of... USvGoogle on the weight of contemporaneous statements is already a massive shadow over MZ. /2
I think MZ has a tell. He often says, "Well that is an interesting question" when asked about his prior contemporaneous statements on fairly obvious questions such as "Is it true that Facebook users like less ads in their feeds?" /3
with FTC's opening statement slides (109 of them over 86 minutes IYKYK)) now posting, I want to flag just a few of them worth amplifying. /1
These two statements from Judge Boasberg his denial of Meta's motion to dismiss last November will weigh heavily on Facebook imho. The evidence from both the Instagram deal and WhatsApp deal are damning considering just these two bullets. /2
This slide (and the next one) were interesting in getting internal reflections of Meta/Facebook forcing more ads into the Instagram experience. /3
FTC v Meta Day 1. Opening arguments for FTC laid out its case. As predicted, Meta tried to blow hole into market definition. This actually comes later in trial so not dwelling but will add some context at end. But first witness 1 was CEO Zuckerberg. Dead to rights on conduct. /1
Internal Facebook employee messages (some we've previously seen plus plenty more) make the Instagram deal clearly anticompetitive conduct imho. Exhibits may not post until Wed so my quotes are my best snapshots from messages in exhibits on screens. Relay with care. I tried. /2
Zuckerberg has testified for only 3 hrs of FTC's estimated 7hrs so he's back on stand tomorrow at 9:30am ET (remember, Careless People book said he hates mornings). FTC has been systematically laying out timeline of Facebook shift to mobile and acquisition of Instagram. /3
As Meta’s Andy Stone works overnight criticizing whistleblower testimony today on their role in China, let’s not forget Meta worked furiously thru billions in settlements to keep sealed it provided data access to 86,961 developers in China unsealed after court sanctions in 2023.
That slide is from their own internal audit. The one they promised the public and Congress in testimony then buried it including fighting to keep the forensic clean up artists aka auditors under seal, too, until an attorney said it in open courtroom. storage.courtlistener.com/recap/gov.usco…
Here is Stone’s statement this morning. He has a track record burying for his bosses so just think it’s important context when he tries to brush aside China. Thank you @HawleyMO for accountability here. nbcnews.com/tech/social-me…
Pretrial orders starting to give taste as to why WSJ reports Mark Zuckerberg is meeting Pres. Trump desperately trying to settle its FTC lawsuit 11 days from trial. Court just ordered Meta to release all internal discussions of "integrity" issues up until 2020. That's toxic. /1
Also included is evidence as to what appears to be Apple warning Facebook/Meta to address CSAM on WhatsApp chat groups. Remember, advertisers built this company investing hundreds of billions of dollars to support it. /2
On that note, we will also likely see the financials for WhatsApp which was acquired by Facebook for nearly $19B despite almost no revenues. The why this happened will be a key argument in the court room. /3
The American values of IP protection have been a cornerstone in the country’s innovative spirit and competitive edge over foreign adversaries. DCN focused on strong copyright protections in our comments filed for the AI Action Plan. Will share some thoughts here. /1
Weakening copyright protections, whether at home or abroad, threatens US economic growth and the global competitiveness. Importantly, this point is inclusive of content creators across all platforms. The invented "right to learn" by machines is BS spin from OpenAI and Google. /2
Simply put, AI firms must not use copyrighted content without consent or compensation, as this undermines fair competition and creator rights. And they should be required to disclose when they've used it without consent. /3