A German court has ruled that Meta is liable for fake advertisements posted by third parties on Facebook and Instagram. As a result, the court ordered the US technology company to remove the advertisements and pay damages.
The case was brought by the operator of a German financial portal and its founder. According to the court, their trademarked logo and image were used without permission in advertisements promoting investment opportunities.
The plaintiffs argued that the advertisements were linked to fraudulent activity. Meanwhile, the court’s ruling, dated September 16, also requires Meta to provide information about the advertisements and the revenue generated through them.
Court Rejects Meta’s Defence
The financial portal operator reported almost 260 violations to Meta during August 2024 alone, according to the court. However, some reported advertisements reportedly remained online for as long as 62 days before they were removed.
The court ruled that Meta could not rely on the Digital Services Act’s lack-of-knowledge defence in the case. Instead, judges said the company’s role in managing content was important to their decision.
According to the ruling, Meta’s platforms are not simply chronological feeds. In addition, the court said the company exercises control over content through its algorithms and advertising systems.
The German court also referred to a precedent established by the European Court of Justice in a ruling issued in June. Therefore, the European legal framework played an important role in the German court’s assessment.
Meta Disagrees With Decision
Meta said it disagrees with the court’s decision and is considering its next steps. At the same time, a company spokesperson said Meta had already taken significant measures to address fraudulent advertisements.
These measures include proactive detection systems and the removal of content reported to the company. In addition, Meta said it continues to work on identifying and removing deceptive advertisements.
The ruling does not mean the case has reached its final stage. For now, the decision remains subject to possible further legal proceedings.
The court said the decision is not yet legally final. However, Meta can challenge the ruling by lodging an appeal.
What the Ruling Means for Meta
The decision could have wider implications for how social media companies handle fraudulent advertising on their platforms. In particular, the case examined the responsibilities of a platform hosting advertisements posted by third parties.
The court also considered whether Meta could rely on protections available under the Digital Services Act. As a result, the decision could become relevant to future disputes involving online platforms and misleading advertisements.
Furthermore, the court’s order requiring Meta to disclose information about the advertisements and related revenue adds another significant element to the case.
For users, fake investment advertisements can create serious financial risks. Often, fraudsters misuse the names, photographs and logos of legitimate businesses or individuals to make promotions appear credible.
Nevertheless, Meta’s appeal options mean the legal dispute is not necessarily over. Further proceedings could determine whether the German court’s interpretation remains in place.
