Meta loses legal fight against regulators, Andrew Forrest

Meta has lost a legal fight to have a lawsuit over fake celebrity ad scams on Facebook paused while a criminal proceeding launched by Andrew Forrest goes ahead in Western Australia.

Fortescue chairman Andrew Forrest. Picture: Jacquelin Magnay

Meta has lost a legal fight to have a lawsuit over fake celebrity ad scams on Facebook paused while a criminal proceeding launched by mining magnate Andrew Forrest goes ahead in Western Australia.

In reasons published on October 27 but released on Wednesday, Federal Court judge Elizabeth Cheeseman said Meta’s application to have the joint Australian Competition and Consumer Commission and Australian Securities Investments commission case stayed should be dismissed.

“The application is premature and fails to adequately allow for the protective mechanisms available to the Court to manage the competing prejudices in issue in relation to the two proceedings at this stage,” she said.

“I am not persuaded that the interests of justice require an immediate stay of all interlocutory steps.

“Active case management with an eye to ameliorating the risks identified by Meta on this application during the pendency of the criminal trial will enable the civil proceeding to continue to progress at this stage.”

Dr Forrest launched a case against the tech giant in the Western Australia magistrates’ court in January last year.

He has accused Meta of failing to take down fake cryptocurrency advertisements on their platform which featured the billionaire and other famous Australians.

Meanwhile, Justice Cheeseman’s judgement said the corporate regulators also launched civil proceedings about the same issue in March last year.

Their case claimed that since at least October 2017 Meta has, “as a consequence of an advertising process with an automated self-service function displayed advertisements on the Facebook platform targeted to Australian users featuring various public figures purportedly endorsing different investment schemes, typically involving trading in cryptocurrency”.

One of the public figures whose identity is used in the Celebrity Fake Endorsement Ads is Dr Forrest.

Meta had applied to the Federal Court to pause the civil proceeding until the criminal one concluded.

Justice Cheeseman’s judgement acknowledged there were similarities between the cases and said the application for a stay was “vigorously contestested”.

“Meta seeks a stay on the basis there is a risk of prejudice to Meta Platforms in the conduct of the criminal proceeding,” she said.

“The Commission submits that the stay application is premature at this stage because the Court has tools at its disposal by which this proceeding may be progressed in a way that adequately manages the risk of prejudice.”

Justice Cheeseman said she was not persuaded by Meta’s arguments.

“First, (their arguments) are premised on an assumption that there is a real risk that the prosecutor will obtain access … to Meta’s defence(s),” she said.

“Secondly, I am not persuaded that the presumptive prejudice which Meta submits Meta Platforms will suffer in the criminal proceeding is such that the interests of justice require an immediate stay of the civil proceeding.”

There were some redactions in the judgement.

The case has been listed for a further hearing in December.