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Facebook called out for inflating ad metrics to increase revenue

The internal emails of Facebook Inc. made public in court reveal that the company misrepresented advertisers’ estimated audience, calling the practice “deeply wrong”.

According to a filing on Wednesday in San Francisco federal court, senior executives didn’t intend to fix the problem due to it’s significant impact on revenue.

A 2018 lawsuit filed by small business owner allegedly accused  that the social media giant has for years inflated its estimates of the number of people an ad could reach.

However, a US district judge refused to dismiss the fraud claims and gave approval for the trial by throwing out the breach of contract allegations.

Moreover, the company has faced massive criticism citing disclosure of errors in the way it’s calculated ad metrics and made changes clarifying how those figures are determined.

Further, Facebook was reportedly aware that the problem was largely due to fake and duplicate accounts.

Despite having complete knowledge of the matter, the company made a “deliberate decision” not to remove those accounts from potential reach.

It also resorted to keep some filings confidential over concerns about their sensitivity, but U.S. District Judge ruled that unsealing them was in the public’s interest.

Plaintiffs’ lawyers clarified how internal communications reveal that Facebook knew its “potential reach” was misleading in spite of the company downplaying the metrics.

Meanwhile, the revenue it generated was based on wrong data as confirmed by an unidentified product manager.

Facebook couldn’t be reached for a comment on this legal battle but the company said that when the case was first filed, it was without merit.


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