Following reports that Facebook data had been improperly shared with Cambridge Analytica and used by the campaign of Donald J. Trump, Free Speech For People submitted a books and records inspection request under Delaware Corporations Code Section 220 on behalf of a shareholder to learn what the company knew, when it knew it, and what actions it took in response to Cambridge Analytica’s misuse of Facebook data of 50 million users in the 2016 election.
Delaware law provides investors with a key tool to investigate exactly the kind of mismanagement and wrongdoing that seems to be at the heart of this massive breach of trust with Facebook’s users about how and when their data may be accessed. Investors may inspect records for any number of proper purposes including “seeking an audience with the board to discuss proposed reforms.”
The demand seeks the documents to allow the shareholder to investigate the actions of Facebook’s senior management and board with respect to the Company’s admission that Global Science Research, Cambridge Analytica and Eunoia Technologies, Inc. misused Facebook user data; whether Facebook’s senior management or board of directors engaged in mismanagement, wrongdoing, or breach of fiduciary duties in dealing with the misuse of user data by Global Science Research, Cambridge Analytica and Eunoia Technologies, Inc., and whether this mismanagement, wrongdoing, or breach of fiduciary duties may have occurred with respect to other third parties that Facebook entered into agreements with regarding the acquisition of Facebook user data between 2014 and the present.
“The mismanagement of this scandal is yet another black mark on Facebook’s senior management and board of directors,” said Shanna Cleveland, Senior Counsel at Free Speech For People. “The abuse of social networks to influence the 2016 presidential election is not only an existential threat to democracy, it also poses an existential threat to Facebook’s business model that management and the board appear unwilling or unable to reckon with.”
You can read the full demand here.