Meta Faces Hefty Fine Over Fraudulent Havan Ads

Meta Platforms is facing a possible $3.62 million fine after losing a lawsuit by Brazilian retailer Havan. The lawsuit accuses Meta of running fraudulent ads using Havan's name and owner’s likeness. A judge ordered Meta to block such ads within 48 hours. Havan hails the decision as a landmark for rights protection.

Meta Platforms faces a significant penalty of up to $3.62 million following a lawsuit initiated by Brazilian department store chain Havan. The company accused Meta of accepting paid advertisements that fraudulently used Havan's name, deceiving consumers.

In a ruling on Monday, Judge Joana Ribeiro from Santa Catarina state mandated that Meta must block any ads not contracted by Havan or its owner, Luciano Hang, within 48 hours. Non-compliance could result in fines amounting to 20 million reais. Judge Ribeiro emphasized the unacceptability of Meta's business model reliant on insecure ad sales.

Havan labeled the decision as a significant milestone for the protection of the company and Hang's rights in a statement on Monday. Meta declined to comment but has the option to appeal. The lawsuit highlighted that Meta profits from illegitimate ads without verifying their legitimacy, which led fraud victims to take legal action against Havan. Earlier this year, Reuters confirmed three fake Havan ads on Meta platforms, which applied AI to mimic Hang's voice.

The false advertisements resulted in consumers paying for non-existent products.

(With inputs from agencies.)