A high-stakes trial opened this week in Delaware as shareholders of Meta Platforms seek to recover $8 billion in damages, alleging that the company’s leadership mishandled a massive privacy scandal settlement dating back to 2019.

Investor Allegations Center on $5 Billion Fine

At the heart of the case is a historic $5 billion fine that Facebook—now Meta—agreed to pay the U.S. Federal Trade Commission (FTC) in 2019. The penalty resolved regulatory claims over Facebook’s user data practices, particularly in the wake of the Cambridge Analytica scandal.

However, investors argue that the board of directors failed in its fiduciary duty by approving the massive settlement in a way that shielded CEO Mark Zuckerberg from further legal exposure, rather than prioritizing shareholder interests.

Key Testimony from Ex-Director Jeffrey Zients

The first to testify in the non-jury trial was Jeffrey Zients, current White House Chief of Staff and former Meta board member (2018–2020). Zients defended the board’s actions, stating that the decision to settle was not to protect Zuckerberg, but to allow the company to focus on long-term business goals.

“There was no intention to provide Mark [Zuckerberg] with personal cover. The priority was to move forward and invest in user trust and platform growth,” Zients testified before Delaware Chancery Court’s Chief Judge Kathaleen McCormick.

Trial to Continue Until July 25

The proceedings are set to continue until July 25, with more testimonies expected from Meta’s former executives and board members. The case is being heard in the Delaware Chancery Court, a pivotal venue for corporate litigation in the United States.

This trial comes amid growing legal and public scrutiny over how tech giants like Meta manage user data, handle regulatory pressure, and exercise board oversight—especially in matters involving high-profile executives.

Background: From Facebook to Meta

Facebook rebranded to Meta Platforms Inc. in 2021 as part of a broader strategy to pivot toward building the metaverse. The rebrand did little to stem criticism of its historical privacy practices, which continue to haunt the tech giant through litigation like this.