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A California federal judge signaled Wednesday that Meta Platforms Inc. may not easily escape a proposed class action accusing the tech giant of allowing hackers to seize users’ Facebook accounts — all while continuing to profit from their personal data and posted content.

U.S. District Judge William H. Orrick said he was “not inclined” to grant Meta’s full motion to dismiss but suggested he might trim portions of the complaint, particularly a breach of contract claim, allowing the plaintiffs an opportunity to amend it.

“This is a plausible theory,” Judge Orrick remarked during the Zoom hearing, referring to allegations that Meta maintained users’ licenses for profit even after hackers took over their accounts.

Users Claim Meta Profits From Hacked Accounts

The plaintiffs, led by Sara Isgur, allege that Meta ignored their pleas for help in regaining control of their hacked Facebook profiles — effectively letting cybercriminals exploit their accounts while Meta continued monetizing the data and content under its licensing terms.

Because users grant Meta a broad license to their content when joining Facebook, they argue they’re trapped: unable to delete hacked accounts or revoke Meta’s access to their data.

Meta’s defense insists the company isn’t liable for third-party account takeovers, citing its terms of service (TOS), which disclaim responsibility and limit liability. “Something cannot be a violation of the implied covenant if it is expressly permitted by the terms,” said Meta attorney Melissa Zappala of Dunn Isaacson Rhee LLP.

Legal Battle Over Data Rights and Fair Practices

Judge Orrick appeared more sympathetic to claims of unjust enrichment and violations of California’s Unfair Competition Law (UCL), suggesting those could proceed. However, he hinted that the fraud prong of the UCL might not survive due to lack of specific evidence.

The judge noted that California Civil Code Section 1668, which voids contracts exempting parties from liability for willful misconduct, could undermine Meta’s defense if proven applicable.

Plaintiffs’ counsel Annick Persinger of Tycko & Zavareei LLP countered Meta’s stance, arguing that maintaining a license to user data without restoring access “frustrates the fundamental purpose of the contract,” as the TOS explicitly says licenses end when users delete their content.

Massive Class and Mounting Scrutiny

Filed in September 2024, the suit claims “hundreds of thousands, if not millions” of Facebook users may have been impacted by similar hacks and Meta’s inaction. The amended complaint, lodged in June, asserts that Meta breached fiduciary duties, violated California’s UCL, and failed to act in good faith.

Meta, for its part, contends that it never promised to restore hacked accounts or offer personalized customer support. “The plaintiffs imagine promises Meta never made,” the company’s motion to dismiss stated.