10 October, 2021

Bring Zuckerberg and Facebook to justice

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Six ways to hold Mark Zuckerberg and Facebook accountable for the harm they do
Image credit: Justice League

Zuckerberg denies Facebook spreading racist posts, election meddling, COVID disinformation and worse. Superheroes needed to bring him to justice.

What can be done to bring Facebook to justice when Zuckerberg has majority control with his Class B shares? How have other corporations like Volkswagen behaving badly been fixed? Should regulations be revised? What does Frances Haugan, Facebook whistleblower suggest? Click on this interactive power map for ideas.

Zuckerberg denies Facebook spreading racist posts, COVID disinformation and worse. Superheroes needed to bring him to justice.

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- Revoke Zuckerberg's special Class B share in Facebook

- Does Facebook deserve 230 Communications Decency Act protection?

- Hold who wrote Facebook's algorithm to account

- Does Facebook meet the standard for Delaware corporations?

- Protect Facebook shareholders' rights

- Hold Facebook's Board of Directors accountable

- Hold Facebook liable for the harm it causes

Revoke Zuckerberg's special Class B Facebook shares

"Zuckerberg owns the majority of the voting rights to the company. Facebook’s Class B shares, controlled by Zuckerberg and a small group of insiders, has about 18 percent of the shares. But their Class B shares have 10 votes per share while the Class A shares which the public owns have only one vote per share. The net effect: Zuckerberg and a small group of insiders control almost 70 percent of the voting shares in Facebook. Zuckerberg himself controls nearly 60 percent of the stock.

Stock ownership traditionally conveys a say in how companies are run. Ownership is more than just participating in a financial upside; it also conveys the right to participate in how a company is governed. The Council of Institutional Investors said multiple class listings should be removed from equity indexes. “We believe all companies that go to the public markets should be one share, one vote,” Deputy Director Amy Borrus. “When they have this much control, it’s hard to hold the founders accountable.” - CNBC

Frances Haugen suggests that Facebook algorithm be denied Section 230 protection.

Does have deserve Section 230 protection if it acts 'indecently'

"Section 230 is a provision of the 1996 Communications Decency Act that protects companies like Facebook and Google that host user-created content from lawsuits over posts on their services. Section 230 isn't blanket protection. There are exceptions for federal crimes or intellectual property claims. The law provides social media companies with sweeping protections that let them choose what content they restrict, and how. This means social media platforms can't be sued for taking down content or leaving it up." 

"Frances Haugen in her testimony called on Congress to regulate Facebook and require more transparency from the company on its practices. She also urged lawmakers to reform a key federal law, Section 230 of the Communications Decency Act, which shields internet companies from legal liability for content posted by its users. She suggested that lawmakers revise Section 230 to make Facebook responsible for its algorithms, which are used to rank content. In doing that, Haugen thinks the company would get rid of engagement-based ranking, which feeds a cycle of feeding harmful, inflammatory or untrue content to users." - CNET

Hold who wrote Facebook's algorithm to account

Facebook develops its algorithm to make people spend more time on its platform so it can show them more ads. Racist, sexist, hateful content gets people agitated, glued to the platform and more likely to share that post.

"Facebook whistle-blower Frances Haugen, who testified before the US Senate on October 5, has released internal documents that show Facebook was facing a decline in engagement in 2017, which threatened its revenue stream and market dominance. To avoid a decline in engagement Facebook executives — ultimately, a decision by Mark Zuckerberg — changed the algorithm that controls the “News Feed” of its two billion customers, boosting content that favors user actions such as reshares and comments, rather than content from close friends and relatives.

Internal documents released by Haugen show that after the network made the change, boosting downstream MSI (what Facebook calls 'meaning social interactions'), engagement did increase, but at a social cost. The documents show the company received complaints from media outlets and political parties observing that the algorithm, by promoting high-engagement content, was amplifying negative posts that provoked an emotional response from users. The documents show that this led to complaints of increased political strife." - Center For International Governance Innovation (CIGI).

"The VW group must resolve the damage quickly. It cannot be that customers will be hit by the disadvantages," he said. "Weeks ago, we arranged a recall regarding all diesel vehicles, which will kick off in January 2016. We are dealing with the VW affair much more in Germany.
Source: IBI

Does Facebook met the standard for Delaware corporations?

"People are responsible for their individual actions. But what about the company as an entity? In a new book titled The Moral Responsibility of Firms, authors Eric Orts and Craig Smith and contributor Amy Sepinwall argue that companies are indeed morally culpable. “In an organization, it’s often easy to hide when you’re doing something you might know is wrong", said Eric Orts.

Just take the Volkswagen example [and its emissions cheating scandal]. If I bought a Volkswagen, it was not correct that it was represented as an environmentally friendly vehicle. There was environmental fraud conducted. But then is it true that Volkswagen as a whole is responsible for that, or is it only the individuals within Volkswagen who may have known about it who were involved in the deception?" - Wharton

"Facebook Inc is a corporation in Menlo Park, California. The employer identification number (EIN) for Facebook Inc is 201665019. EIN for organizations is sometimes also referred to as taxpayer identification number or TIN or simply IRS Number. It is one of the corporates which submit 10-K filings with the SEC. Facebook Inc 10-K filing includes an Exhibit 21 subsidiary information. Facebook Inc is incorporated in Delaware and the fiscal year end is in 31 December. The Central Index Key (CIK) for Facebook Inc is 1326801." - EIN Tax ID

Facebook is a Delaware corporation
Board directors should be willing to ask tough and probing questions to vet all sides of an issue. Board directors need to be well-informed and fully engaged with all major issues that affect the corporation.

Hold Facebook's Board of Directors accountable

"Board directors of today are expected to represent independent and diverse perspectives. Their main role is to perform the duties of strategic planning and oversight. Board directors are much more than iconic figureheads. Boards typically look for specific qualities in choosing board members to fill vacant seats. Board directors should be willing to ask tough and probing questions to vet all sides of an issue. Board directors need to be well-informed and fully engaged with all major issues that affect the corporation... Board directors must be willing to act quickly and responsibly when they need to take action to comply with fiduciary responsibilities or to uphold good governance standards. Board members need to stand ready to thwart potential crises and to manage developing crises, so they don’t adversely affect the corporation." - Diligent

What did Facebook directors know about anti-social content being pushed to keep users on the platform longer to serve more ads and boost profits? What was their advice?

"Peter Thiel is secretly funding Hulk Hogan’s lawsuit against Gawker Media, according to sources who spoke to Forbes and The New York Times on the condition of anonymity." - Independent
(Pool/Getty, Fred Prouser/Reuters, Pictures of Money/Flickr)

Facebook Director Thiel

"Peter Thiel is secretly funding Hulk Hogan’s lawsuit against Gawker Media, according to sources who spoke to Forbes and The New York Times on the condition of anonymity." - Independent

"Peter Thiel, a PayPal cofounder and one of the earliest backers of Facebook , has been secretly covering the expenses for Hulk Hogan’s lawsuits against online news organization Gawker Media. According to people familiar with the situation who agreed to speak on the condition of anonymity, Thiel, a cofounder and partner at Founders Fund, has played a lead role in bankrolling the cases Terry Bollea, a.k.a. Hogan, brought against New York-based Gawker. Hogan is being represented by Charles Harder, a prominent Los Angeles-based lawyer.

The involvement of Thiel, an eccentric figure in Silicon Valley who has advocated for teenagers to skip college and openly supported Republican presidential candidate Donald Trump, adds another wrinkle to a case that has garnered widespread attention for its implications over celebrity privacy and a publication’s First Amendment rights. During court proceedings, which ended in late March with a $140 million victory for Hogan.

Lawsuits like these can have a chilling effect on the rest of the media industry.“ That’s often the purpose of these cases,” said Scheer, the director of the First Amendment Coalition. “Winning is the ultimate chilling effect, but if you can’t win the case, you at least want the editors to think twice before writing another critical story about you.” - Forbes

Treat Facebook shareholders fairly

"Facebook paid billions extra to the FTC to spare Zuckerberg in data suit, shareholders allege. The company allegedly agreed to overpay on the original $106 million penalty so its CEO and COO could avoid deposition and personal liability. “Zuckerberg, Sandberg, and other Facebook directors agreed to authorize a multi-billion settlement with the FTC as an express quid pro quo to protect Zuckerberg from being named in the FTC’s complaint, made subject to personal liability, or even required to sit for a deposition,” one of the suits alleged.

The FTC has never disclosed that it originally planned to name Zuckerberg personally in the lawsuit, and the agency's two Democrats at the time voted against the settlement in part because of the lack of personal liability for the CEO.

The FTC also said in court that Facebook’s fine would have been closer to $106 million, but the company agreed to the $5 billion penalty to avoid having Zuckerberg or Chief Operating Officer Sheryl Sandberg deposed and any liability for the CEO, the suit alleged. “The Board has never provided a serious check on Zuckerberg’s unfettered authority,” one set of shareholders said. “Instead, it has enabled him, defended him, and paid billions of dollars from Facebook’s corporate coffers to make his problems go away.” - Politico

TakeAway: Hold Zuckerberg and Facebook execs and directors accountable for the harm Facebook is doing. Where are the superheroes when we need them?


Image credit: Justice League
"The Justice League is a fictional team of superheroes that appears in American comic books published by DC Comics."

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