The Spanish media are advancing their judicial crusade against Meta for unfair competition in the sale of digital advertising by using personal data in breach of European regulations. The Commercial Court number 15 of Madrid has rejected the claim of the parent company of WhatsApp, Facebook and Instagram to consider the Spanish justice system incompetent to resolve the lawsuit filed at the end of last year by the Information Media Association (AMI) in representation of more than 80 newspapers, including EL PAÍS.
The lawsuit bases its accusation against the company led by Mark Zuckerberg on its “systematic and massive” failure to comply with European regulations that prohibit improper use of social media user data. This illegitimate conduct gave the technology company a dominant position in the advertising market. The plaintiff media, through AMI, claim 550 million euros in compensation for the income they stopped receiving between 2018 and last July.
The judge explains in an order issued this Friday that “the use of protected data allows Meta to carry out selective advertising, based on ages, tastes, interests, hobbies, trips…”. Furthermore, “the possibility of offering selective advertising makes advertisers opt for this form of advertising over other forms of advertising that are harmed.” Judge Teodoro Ladrón Roda explains that “the problem raised by the lawsuit is that this selective offer is achieved through the obtaining and use of protected data, in a manner and manner that may constitute conduct of unfair competition that can be classified as competitive illicit.” And he concludes that “the statement that Meta's decisions are made in Ireland does not cloud the clear clarity that allows us to appreciate that the damage occurs in Spain.”
After receiving the lawsuit, Meta Ireland questioned the competence of the Spanish justice system to deal with the case. This procedural trick was raised through a declinatory action with the objective that the court would refrain from studying the matter and the process would be dismissed. The letter argued that since the company's domicile is in Ireland, it should be the courts of that country that resolve the claim. The attribution of jurisdiction to the Spanish courts exposed them, according to Meta, to being sued in any other EU Member State, with the consequent damages in terms of legal costs, time and resources allocated for this purpose. None of this has been taken into consideration in the court order.
Said judicial body bases its legitimacy to hear the claim on the provisions of European Regulation 1215/2012, which regulates judicial jurisdiction in civil and commercial matters within the European Union. As this is a claim for damages and non-contractual fault, said jurisdiction to hear this type of matter is established in Article 7.2 of said Regulation: “A person domiciled in a Member State may be sued in another Member State: […] in criminal or quasi-delictual matters, before the jurisdictional body of the place where the harmful event occurred or may occur.” In this sense, the judge points out that, since the plaintiff companies are domiciled in Spain, there is no doubt that the damage suffered by them has occurred in Spain and hence Meta's ruse to avoid being prosecuted by the Spanish courts.
According to 2022 data, platforms account for 44% of the Spanish advertising market. European data protection regulations dictate that citizens must accept the use of their information to receive targeted advertising. AMI considers that Meta made use of citizens' personal data for years to sell segmented advertising without a legal basis for it, “threatening with this conduct the sustainability of the media and the right to information of Spanish citizens.”
After this setback, Meta will have a period of less than 20 days to present its response to the lawsuit. During this period, he will have to justify his conduct, which was labeled as illegal by more than 80 Spanish media, before the Commercial Court. The average duration of this type of unfair competition procedures in the courts of Madrid is around two and a half years, according to the latest records of the General Council of the Judiciary.
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