• by Wendy Davis  @wendyndavis, January 26, 2024

Meta Platforms is urging a federal appellate court to halt a Federal Trade Commission administrative proceeding that could result in an order prohibiting the company from monetizing teens' data.

In papers filed Thursday with the D.C. Circuit Court of Appeals, Meta argues that the FTC is wrongly attempting to revise a settlement approved in 2020 by U.S. District Court Judge Timothy Kelly in Washington. The company contends that only a federal judge -- and not the FTC -- can order changes to that settlement.

Meta's new papers come in a battle dating to last May, when the FTC proposed modifying the 2020 settlement by adding terms prohibiting Meta from using minors' data to fuel ad targeting or algorithms. The original settlement stemmed from charges that Meta allowed Cambridge Analytica and other outside developers to access users' data. That deal required Meta to pay $5 billion, implement new privacy oversight and obtain an independent assessment.

When the FTC proposed the new terms, it served Meta with a demand to appear at an in-house administrative proceeding -- similar to a trial, but in front of the agency, as opposed to a judge. The FTC alleged that an evaluator had identified “gaps and weaknesses” in the company's privacy program, and that between 2017 and 2019, Meta's Messenger Kids had coding errors that allowed children to communicate with people who hadn't been approved by parents, in violation of representations about the feature.

Meta sued in federal court to prevent the FTC from moving forward with an in-house hearing, arguing that only Kelly or another judge could modify the 2020 settlement.

Kelly rejected that argument in November, ruling that he lacked jurisdiction to intervene in the current dispute. He ruled that even though Meta's agreement with the FTC was attached as an exhibit to the judgment he approved, he didn't retain jurisdiction over the terms.

Meta has appealed that decision to the D.C. Circuit, and is also asking the appellate court to prevent the FTC from conducting an in-house hearing while the appeal is pending.

“Meta will suffer irreparable harm by being ... forced to relitigate a settlement with its counterparty as adjudicator,” the company argues in its request for an injunction halting the FTC's in-house proceeding.

Meta adds that it never agreed the FTC could “unilaterally modify” the settlement terms.

“The government has not pointed to any instance in which the commission has modified a consent order without such consent,” Meta writes.