Add Category
One of Facebook innovations is how it ensures this immunity is enjoyed by its business in overseas markets by Australia with an offshoring model that means it doesn’t technically operate in Australia.
This means any victims and aggrieved parties, like Forrest, are forced to sue it in the US.
President Bill Clinton enacted legislation that gave the nascent internet services industry immunity from what was published on their platforms.Credit: AP
Another innovation was putting its advertising business inside the entity that owns the social media platform. This means Facebook can use the same immunity to ensure it has no liability for the scam ads that appear on its platform.
Forest’s legal battle is challenging Meta on these two fronts, first to stop it using US immunity to protect it from liability in Australia, but also to remove the immunity cloak from its ad business globally which generated almost all of its revenue – $US132 billion last year.
It is one of Forrest’s key claims that Meta’s advertising business is separate and distinct from the Facebook user platform rather than an integrated part of the business.
Loading
“If they profit from Australians, they should not be able to hide behind Californian laws that leave Australian users exposed,” Forrest has said.
Clarke says: “No litigant has previously challenged the global reach of this US immunity that big US tech companies enjoy.
“Ad displays generated by Meta are business activities over which they have complete control, and it was not Congress’s intention in 1996 to immunise internet service providers running social media platforms from negligence and bad business practices.”
Katharine Kemp, an associate law professor at the University of NSW, who researches competition and consumer protection regulation, including their application to digital platforms, also backs Forrest’s assertion that Facebook’s role in delivering these ads to vulnerable members plays a key role.
“Facebook is so much more involved in actually bringing that ad to a particular person, based on their profile, and profiting from the person engaging with the ad, so are gaining from the misconduct of others in their ad business, and it certainly should be their responsibility in light of that,” she said.
Facebook declined to comment on the case given it is before the courts, but executives have pointed out it is up against sophisticated, well-funded and well-connected organised criminal networks.
The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.