Australia’s Federal Court has ordered Meta Platforms, the parent company of Facebook, to pay fines totaling A$20 million ($14 million) for unlawfully collecting user data through a smartphone application that claimed to protect privacy without revealing its data collection practices.
The court found that from early 2016 to late 2017, Meta (then known as Facebook) promoted an app called Onavo as a tool to safeguard users’ personal information. However, the app secretly collected users’ location data, information on their app usage patterns, and details of websites they visited, all for Meta’s commercial purposes.
The Australian Competition and Consumer Commission (ACCC) filed a civil lawsuit against Meta and its subsidiaries, Facebook Israel and Onavo, leading to the recent court ruling. As part of the judgment, Meta was also ordered to pay A$400,000 in legal costs to the ACCC.
In her written judgment, Judge Wendy Abraham expressed concern that the lack of proper disclosures by Meta might have prevented tens of thousands of Australian consumers from making informed decisions about their data privacy before using Onavo Protect.
Interestingly, the court acknowledged that it had the authority to impose a far more substantial fine, potentially amounting to hundreds of billions of dollars, as the app was downloaded by Australians over 271,000 times, with each violation of consumer law carrying a fine of A$1.1 million. However, the court viewed the transgressions as a single course of conduct.
The A$20 million fine was mutually agreed upon by the regulator and Meta Platforms. Judge Abraham emphasized that this penalty was designed to have a significant impact on Meta, ensuring that it does not treat such violations as merely a cost of conducting business.
This landmark ruling serves as a warning to tech companies about the importance of transparently disclosing data collection practices and respecting user privacy in all their applications. The ACCC’s successful lawsuit against Meta sets a precedent for holding tech giants accountable for any potential misuse of user data in Australia.
