Advertisers claim that Meta misrepresented the 'potential reach' of their ads, thereby misleading businesses during the purchasing process.

On January 13, 2025, the U.S. Supreme Court declined to hear an appeal from Meta Platforms regarding a multi-billion dollar class action lawsuit filed by advertisers.

The Court's decision upholds a lower court ruling that allows advertisers to collectively seek damages from Meta.

The lawsuit involves allegations that Meta overcharged advertisers by providing exaggerated figures about ad reach on Facebook and Instagram.

Further developments in the lawsuit are expected as advertisers continue to pursue their case against Meta.

Meta heavily relies on advertising revenue, making the legal dispute with advertisers a critical concern for its business operations.

The advertisers allege that Meta misrepresented the reach of its advertisements by counting accounts instead of actual users, potentially seeking damages exceeding $7 billion.

This ruling is a significant setback for Meta Platforms and underscores the increasing scrutiny of tech companies' advertising practices.

The class action could involve millions of advertisers, including both individuals and businesses, significantly impacting Meta's financial outlook.

Despite having resources to handle the lawsuit, maintaining a contentious relationship with advertisers could negatively affect Meta's long-term success.

On the same day, Meta Platforms (META) experienced a decline of over 1% in its stock price following disappointing news from the U.S. Supreme Court.