Meta loses bid to avoid billionaire crypto fraud ad lawsuit

A US judge rejected a bid by the Meta platform after billionaire Australian mining tycoon Andrew Forrest used deep fakes in his image to promote scams in Facebook ads.

California District Judge Casey Pitts ordered Forrest to refile the lawsuit on Monday, June 17, and try to prove that Meta's negligence in failing to stop Meta's fraudulent ads breached its duty to act in a “commercially reasonable manner.”

Meta argued that Section 230 of the Communications Decency Act exempted it from liability as a third-party content publisher — an argument YouTube has tried unsuccessfully to deflect blame for crypto scam ads on its platform.

Rule 30 states that a provider of an “interactive computer service” “shall not be treated as a publisher.” […] Any information provided by another content provider.

But Judge Pitts found that Meta was “not established beyond dispute” that Section 230 provided an “airless defense” to all of Forrest's allegations.

“This is the first time in a US civil court that a social media company has used Section 230 immunity as a defense for its advertising,” Forrest told The Australian.

“The decision means that we can prove in court that Facebook can display fraudulent ads on its website by refusing to take any responsibility,” he said.

Forrest can try plugging meta for ads.

The order said Forrest's amended lawsuit could try to prove that Meta has misused his name and likeness in addition to fraudsters who made false ads.

“Forrest claims that Meta has profited more from advertisements featuring his likeness,” Judge Pitts wrote. “It is sufficient to plead that the alleged abuse was for the meth.”

She also found Forrest “clearly alleging that Meta played an active role in creating the ads at issue.”

Forrest says that Meta has “active involvement” in how its ads are displayed and on which advertising devices they are displayed.

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“These lawsuits present a factual dispute as to whether meta ad systems are independent tools for anyone to use (or abuse) or whether the tools themselves contribute to the content of the ads,” Judge Pitts said.

In April, Australian prosecutors dropped Forrest's criminal charges against meth in the country, saying there was insufficient evidence.

Forbes pegs the net worth of 62-year-old iron ore producer Fortescue Metals Group at $16.6 billion.

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