Supreme Court Sidesteps Meta's Legal Challenge Amid Investor Fraud Claims

The U.S. Supreme Court has declined to make a decision on a securities fraud lawsuit against Meta's Facebook concerning alleged misinformation to investors about data misuse. The justices left the lower court's ruling in effect, allowing the class action led by Amalgamated Bank to continue.

The U.S. Supreme Court on Friday chose not to rule on whether shareholders could proceed with a securities fraud lawsuit against Meta's Facebook. Accusations revolve around misleading investors about user data misuse, specifically tied to the 2015 Cambridge Analytica breach.

Rather than resolving the underlying legal issues, the justices decided to dismiss Facebook's appeal, leaving a lower court ruling that supports the class-action lawsuit intact. This case is one of two current high-profile securities fraud matters faced by the Supreme Court, with another involving Nvidia looming.

Underpinning the lawsuit is the claim that Facebook failed to disclose a major data breach in its risk assessments. Critics argue this omission misled investors, while Facebook maintains its disclosures were meant as hypothetical risk indicators. The controversy stems from fallout over the 2018 media reports detailing data misuse linked to major political events.

(With inputs from agencies.)