German Court Rules Meta Liable For Fake Ads On Instagram, Facebook

A German court has found Meta liable over fake advertisements posted by third parties on Instagram and Facebook and ordered the U.S. tech company to remove the material and pay damages, according to Economic Times. The ruling, dated September 16, is not yet final and may be challenged on appeal.

The dispute concerns investment promotions that used the trademarked logo and image of a German financial portal and its founder without consent. The court ruled Meta directly liable for damages and ordered the fake ads to be taken down.

Fraudulent Ads Case

A German financial portal operator launched the legal challenge. Alongside its founder, the company filed suit after unapproved posts across Facebook and Instagram used their registered trademark and likeness to push suspected fraudulent investment schemes.

The portal operator reported nearly 260 violations to Meta in August 2024 alone, according to the court.

Removal was not always quick. Meta took up to 62 days to delete some of the content, the court stated, a delay that formed part of the plaintiffs' case over how the platform handled repeated reports.

Court's Legal Reasoning

The court rejected one key defence. It ruled that Meta could not rely on the Digital Services Act's lack-of-knowledge defence.

The judges said Meta was not comparable to a service that simply displays content in a purely chronological feed. Instead, the court found, the company exercises control over content through its algorithms and advertising practices.

The court referred to a precedent set by a June ruling by the European Court of Justice and then held Meta directly liable for damages while ordering the fake advertisements to be taken down.

Meta Response And Disclosure

Meta pushed back. "We respectfully disagree with this decision and are considering next steps," a Meta spokesperson said in a statement.

The spokesperson added that Meta had taken significant action, including proactive detection measures and removing reported content. According to the ruling, Meta must also disclose details of the fake advertisements and the revenue generated from them.

The ruling is not yet final and may be challenged by filing an appeal, the court stated.