INVESTORS SUE FB OVER USER PROFILE HARVESTING

BROOKLYN/SANFRANCISCO: Facebook Inc.’s failure to safeguard privacy was blamed in an investor lawsuit for a slump in its share price that followed the revelation user data was harvested without permission by a research firm connected to US President Donald Trump.

Facebook was sued in San Francisco federal court on Tuesday by shareholders in a class action who said they suffered losses after the disclosure that Cambridge Analytica, a UK-based firm that aided Trump, improperly obtained profile information on 50 million users.

Facebook fell as much as 5.2% to $175.41 Monday in New York, wiping out all of the year’s gains so far. It was the biggest intraday drop since January 12. The stock dropped another 2.6% Tuesday to close at $168.15, after

Bloomberg reported that the company is under investigation by the Federal Trade Commission (FTC).

The suit would represent people who bought shares of Facebook from February 3, 2017, when Facebook filed its annual report and cited security breaches and improper access to user data, through March 19, two days after a New York Times report revealed how data from Cambridge Analytica obtained through Facebook was used without “proper disclosures or permission.”