Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 1 of 42 Page ID #1
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE SOUTHERN DISTRICT OF ILLINOIS
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`METROPLEX COMMUNICATIONS, INC.,
`on behalf of itself and all others similarly situated,
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`Plaintiff,
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`v.
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`META PLATFORMS, INC.,
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`Defendant.
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`) Case No. 3:22-cv-1455
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`) JURY TRIAL DEMANDED
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`CLASS ACTION COMPLAINT
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`Plaintiff, Metroplex Communications, Inc. (“Metroplex”), on behalf of itself and on behalf
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`of all others similarly situated, for its Complaint against Defendant Meta Platforms, Inc., formerly
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`known as Facebook, Inc., (referred to herein as “Meta” or “Facebook”), states as follows:
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`NATURE OF THE ACTION
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`1.
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`This lawsuit seeks redress under the Lanham Act and the Illinois Uniform
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`Deceptive Trade Practices Act for Meta’s false and misleading statements in its advertising and
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`promotions regarding the amount of people on the Facebook platform and its statements about
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`potentially and actually delivering advertisements to people.
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`2.
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`3.
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`At its core, Meta, formerly known as Facebook, Inc., is an advertising company.
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`Meta primarily generates revenue by selling digital advertisements for placement
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`on the Facebook platform.
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`4.
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`Metroplex, a competitor of Meta, also sells advertisements to businesses seeking to
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`reach consumers.
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`5.
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`The law permits and encourages competition between businesses, but both federal
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`and Illinois state law prohibit unfair competition—and that is the genesis of this lawsuit. Metroplex
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 2 of 42 Page ID #2
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`brings claims of unfair competition on behalf of itself and a class of similarly situated competitors
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`of Meta.
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`6.
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`Throughout the relevant time period, Meta has made false and/or misleading
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`statements regarding the metrics material to consumers considering purchasing advertisements
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`from Meta—including, but not limited to, understating the number of duplicate accounts,
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`understating the number of false accounts, overstating the number of monthly active users in the
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`United States and Canada, and overstating and falsely describing the potential reach, estimated
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`audience size, and achieved reach of advertising campaigns.
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`7.
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`Meta made these false and/or misleading statements for the purpose of, inter alia,
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`influencing potential advertisers to buy, and to continue buying, the main product Meta sells:
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`digital advertising.
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`8.
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`Meta has been paid hundreds of billions of dollars for digital advertising over the
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`past three years and, as such, has become one of the world’s most valuable companies. As a result
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`of Meta’s false and/or misleading statements, however, Metroplex and the class of similarly
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`situated competitors have been, and/or are likely to be, injured by diversion of their sales to Meta,
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`or by lessening of the goodwill associated with their products in light of the false and/or misleading
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`statements Meta has made, and continues to make, about its audience size and delivery of
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`advertisements to people.
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`THE PARTIES
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`9.
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`Metroplex is an Illinois corporation with its principal place of business in Illinois.
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`It is, therefore, a citizen of Illinois. Metroplex offers advertising services to businesses. It sells and
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`places digital and targeted advertisements on its local news website, advantagenews.com, and the
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`“Best of Edwardsville” website, sells radio advertisements for its stations 94.3 FM, 107.1 FM, and
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 3 of 42 Page ID #3
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`1570 AM, and print advertisements that are placed in local newspapers and in the “Best of
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`Edwardsville” magazine.
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`10. Meta is a Delaware corporation with its principal place of business in California. It
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`is, therefore, a citizen of Delaware and California.
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`JURISDICTION AND VENUE
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`11.
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`This Court has personal jurisdiction over Meta because Meta purposefully directs
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`its activities at residents of Illinois and this litigation arises out of, or relates to, Meta’s contacts
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`with Illinois.
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`12.
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`Pursuant to 28 U.S.C. § 1331, this Court has original jurisdiction over Metroplex’s
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`claims arising under federal law. Pursuant to the Class Action Fairness Act, 28 U.S.C. § 1332(d),
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`this Court has original jurisdiction over Metroplex’s claims because Metroplex and Meta are
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`citizens of different states, the total claims of Class Members exceed $5,000,000 exclusive of
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`interest and costs, and there are at least 100 Class Members. The Court has supplemental
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`jurisdiction over Metroplex’s state law claim pursuant to 28 U.S.C. § 1367.
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`13.
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`Venue is proper in this District pursuant to 28 U.S.C. § 1391(b) because a
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`substantial part of the events giving rise to each claim occurred within this judicial district or
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`because this Court has personal jurisdiction over Meta.
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`FACTUAL ALLEGATIONS
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`14. Meta owns and operates the social media platform, Facebook.
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`15.
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`At its core, Meta is a digital advertising company. As self-described in its most
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`recent Annual Report filed with the United States Securities and Exchange Commission (“SEC”),
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` 3
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 4 of 42 Page ID #4
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`“We generate substantially all of our revenue from advertising. The loss of marketers, or reduction
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`in spending by marketers, could seriously harm our business.”1
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`16.
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`In 2021, Meta generated nearly $115 billion in advertising revenue.2
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`17.
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`In 2021, more than $48 billion of Meta’s revenue originated in the United States.3
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`18.
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`In its public filings with the SEC, Meta readily acknowledges it competes with
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`companies like Metroplex: “We compete with companies providing connection, sharing,
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`discovery, and communication products and services to users online, as well as companies that sell
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`advertising to businesses looking to reach consumers and/or develop tools and systems for
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`managing and optimizing advertising campaigns.”4
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`19. Meta acknowledges to federal regulators and its shareholders the vast competition
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`it faces within the marketplace: “We face significant competition in every aspect of our
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`business . . . .”5
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`Meta Markets itself as a Real Identity Platform
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`20. Meta has long represented that it requires users to have just one master account that
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`must be connected to a real person.
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`21.
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`22.
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`According to Meta, this policy helps prevent impersonation and scams.
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`Because of this, Meta has characterized itself as a “real identity platform” that bars
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`users from having multiple personal accounts. As Kirthiga Reddy, the head of Facebook India,
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`1 Meta 2021 10-K, p. 15, https://www.sec.gov/Archives/edgar/data/1326801/000132680122000018/fb-
`20211231.htm.
`2 Id. p. 65.
`3 Id. p. 94.
`4 Id. p. 7.
`5 Id. p. 7.
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` 4
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 5 of 42 Page ID #5
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`explained in 2014: “[W]e are a real identity platform. We have a whole team making sure we keep
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`that trust.”6
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`23.
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`Thus, Meta states: “Authenticity is the cornerstone of our community. . . . [W]e
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`require people to connect on Facebook using the name they go by in everyday life. Our authenticity
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`policies are intended to create a safe environment where people can trust and hold one another
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`accountable.”7
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`24.
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`Accordingly, even where a business or entity has a Facebook page, that page is
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`connected to a real person’s account (or the accounts of multiple real people).
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`25.
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`The perception that advertisements will reach real people is material to consumers
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`deciding whether to purchase advertisements from Meta or to instead purchase advertisements
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`from a competitor of Meta.
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`Meta’s Annual Disclosures of Monthly Active Users
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`26. When a consumer is considering purchasing advertisements on Meta platforms,
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`Meta directs them to review Meta’s quarterly and annual public filings for relevant information
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`regarding users on Meta’s platforms.8
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`27. Meta’s annual public filings provide “key metrics” about its users, “which include
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`daily active users (DAUs), monthly active users (MAUs), and average revenue per user (ARPU).”9
`
`
`6 Shelley Singh & Chaitali Chakravarty, “Buying likes is not a valid business model: Kirthiga Reddy, FB India head”
`The Economic Times, Feb. 4, 2014, https://economictimes.indiatimes.com/opinion/interviews/buying-likes-is-not-a-
`valid-business-model-kirthiga-reddy-fb-india-head/articleshow/29843614.cms.
`7 https://transparency.fb.com/poicies/community-standards/account-integrity-and-authentic-identity/ (last visited
`June 27, 2022).
`8 https://www.facebook.com/business/help/1665333080167380?id=176276233019487 (last visited April 12, 2022).
`9 Facebook 2018 10-K, p. 4, https://www.sec.gov/Archives/edgar/data/1326801/000132680119000009/fb-
`12312018x10k.htm; Facebook 2019 10-K, p. 4,
`https://www.sec.gov/Archives/edgar/data/1326801/000132680120000013/fb-12312019x10k.htm (same); see also
`Facebook 2020 10-K, p. 4, https://www.sec.gov/Archives/edgar/data/1326801/000132680121000014/fb-
`20201231.htm (explaining key metrics are “based on user activity only on Facebook and Messenger and not on our
`other products”); Meta 2021 10-K, p. 4,
`https://www.sec.gov/ix?doc=/Archives/edgar/data/1326801/000132680122000018/fb-20211231.htm (same).
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 6 of 42 Page ID #6
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`The numbers for these key metrics “are calculated using internal company data based on the
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`activity of user accounts.”10
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`28. Meta further states that “these numbers are based on what [it] believe[s] to be
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`reasonable estimates of [its] user base for the applicable period of measurement,” and it is
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`“continually seeking to improve [its] estimates of [its] user base, and such estimates may change
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`due to improvements or changes in [its] methodology.”11
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`29. Meta defines a MAU as “a registered and logged-in Facebook user who visited
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`Facebook through [Facebook’s] website or a mobile device, or used [Facebook’s] Messenger
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`application (and is also a registered Facebook user), in the last 30 days as of the date of
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`measurement.”12
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`30.
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`Although Meta owns other platforms, such as Instagram, it has “historically
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`reported the numbers of [its] daily active users (DAUs), monthly active users (MAUs), and average
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`revenue per user (ARPU) (collectively, [its] ‘Facebook metrics’) based on user activity only on
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`Facebook and Messenger and not on [its] other products.”13
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`31.
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`Thus, Meta explains that “[t]he numbers of DAUs and MAUs discussed in this
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`Annual Report on Form 10-K, as well as ARPU, do not include users on Instagram, WhatsApp, or
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`our other products, unless they would otherwise qualify as DAUs or MAUs, respectively, based
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`on their other activities on Facebook.”14
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`32.
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`On January 31, 2019, Facebook filed an Annual Report with the SEC, also known
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`as a Form 10-K, for the fiscal year ending December 31, 2018 (“2018 10-K”).
`
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`10 Facebook 2018 10-K, p. 4; Facebook 2019 10-K, p. 4; Facebook 2020 10-K, p. 4; Meta 2021 10-K, p. 4.
`11 Id.
`12 Meta 2021 10-K, p. 57; Facebook 2020 10-K, p. 55; 2019 10-K, p. 46; 2018 10-K, p. 37.
`13 Meta 2021 10-K, p 4; Facebook 2020 10-K, p. 4; Facebook 2019 10-K, p. 4. Messenger refers to Facebook
`Messenger, a messaging app that is associated with a person’s Facebook account.
`14 Meta 2021 10-K, p. 6; Facebook 2020 10-K, p. 5; Facebook 2019 10-K, p. 5; Facebook 2018 10-K, p. 4.
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 7 of 42 Page ID #7
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`33.
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`The 2018 10-K stated that, between December 31, 2017 and December 31, 2018,
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`MAUs in the United States and Canada grew from 239 million to 242 million.
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`34.
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`On January 29, 2020, Facebook filed with the SEC a Form 10-K for the fiscal year
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`ending December 31, 2019 (“2019 10-K”).
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`35.
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`The 2019 10-K stated that, between December 31, 2018 and December 31, 2019,
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`MAUs in the United States and Canada grew from 242 million to 248 million.
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`36.
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`On January 27, 2021, Facebook filed with the SEC a Form 10-K for the fiscal year
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`ending December 31, 2020 (“2020 10-K”).
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`37.
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`The 2020 10-K stated that, between December 31, 2019 and December 31, 2020,
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`MAUs in the United States and Canada grew from 248 million to 258 million.
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`38.
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`On February 2, 2022, Meta filed with the SEC a Form 10-K for the fiscal year
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`ending December 31, 2021 (“2021 10-K”).
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`39.
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`The 2021 10-K stated that, between December 31, 2020 and December 31, 2021,
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`MAUs in the United States and Canada grew from 258 million to 262 million.
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`Duplicate and False Accounts
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`40.
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`For years, including in their 2018, 2019, 2020, and 2021 Forms 10-K, Facebook
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`and Meta have acknowledged that a portion of Facebook accounts are what they characterize as
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`“duplicate” and “false” accounts.
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`41. Meta defines “[a] duplicate account [a]s one that a user maintains in addition to his
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`or her principal account.”15
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`42. Meta “divide[s] ‘false’ accounts into two categories: (1) user-misclassified
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`accounts, where users have created personal profiles for a business, organization, or non-human
`
`
`15 Meta 2021 10-K, p. 5; Facebook 2020 10-K, p. 5; Facebook 2019 10-K, p. 4; Facebook 2018 10-K, p. 4.
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 8 of 42 Page ID #8
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`entity such as a pet (such entities are permitted on Facebook using a Page rather than a personal
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`profile under our terms of service); and (2) violating accounts, which represent user profiles that
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`we believe are intended to be used for purposes that violate our terms of service, such as bots and
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`spam.”16
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`Since 2018, Meta Has Repeatedly Reported that, of its Worldwide Monthly Average Users,
`Approximately 11% are Duplicate Accounts
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`Given its participation in the marketplace as a company that sells advertising in
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`43.
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`competition with other companies that sell advertising, Meta is aware that the number of duplicate
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`accounts on its platform is a metric that influences consumers purchasing advertising and,
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`therefore, Meta’s bottom line.
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`44.
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`In its 2015 10-K, Meta reported that approximately 5% of its worldwide MAUs
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`were duplicate accounts, and suggested that the percentage of duplicate accounts in the U.S. was
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`lower than the worldwide figure:
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`We estimate, for example, that “duplicate” accounts (an account that
`a user maintains in addition to his or her principal account) may have
`represented less than 5% of our worldwide MAUs in 2015. . . . We
`believe the percentage of accounts that are duplicate or false is
`meaningfully lower in developed markets such as the United States
`or United Kingdom and higher in developing markets such as India
`and Turkey.17
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`45.
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`In its 2016 10-K, Meta increased this estimate by 1%, reporting that approximately
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`6% of its worldwide MAUs were duplicate accounts, and again suggested that the percentage of
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`duplicate accounts in the U.S. was lower than the worldwide figure:
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`In 2016, we estimate that “duplicate” accounts (an account that a
`user maintains in addition to his or her principal account) may have
`
`
`16 Meta 2021 10-K, p. 5; Facebook 2020 10-K, p. 4 (same); Facebook 2019 10-K, p. 4 (same); Facebook 2018 10-K,
`p. 4 (same, except referring to “(2) undesirable accounts . . . such as [for] spamming” rather than “(2) violating
`accounts . . . such as [for] bots and spam”).
`17 Facebook 2015 10-K, p. 4, https://www.sec.gov/Archives/edgar/data/1326801/000132680116000043/fb-
`12312015x10k.htm.
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`represented approximately 6% of our worldwide MAUs. . . . We
`believe the percentage of accounts that are duplicate or false is
`meaningfully lower in developed markets such as the United States
`or United Kingdom and higher in developing markets such as India
`and Turkey.18
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`46.
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`In its 2017 10-K, Meta increased this estimate by 4%, reporting that approximately
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`10% of its worldwide MAUs were duplicate accounts, and again suggested that the percentage of
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`duplicate accounts in the U.S. was lower than the worldwide figure:
`
`In the fourth quarter of 2017, we estimate that duplicate accounts
`may have represented approximately 10% of our worldwide MAUs.
`We believe the percentage of duplicate accounts is meaningfully
`higher in developing markets such as India, Indonesia, and the
`Philippines, as compared to more developed markets.19
`
`47.
`
`In every annual report since 2018, Meta has reported that approximately 11% of its
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`worldwide MAUs are duplicate accounts, and suggested that the percentage of duplicate accounts
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`in the U.S. was lower than the worldwide figure:
`
`In the fourth quarter of 2018, we estimate that duplicate accounts
`may have represented approximately 11% of our worldwide MAUs.
`We believe the percentage of duplicate accounts is meaningfully
`higher in developing markets such as the Philippines and Vietnam,
`as compared to more developed markets.20
`
`In the fourth quarter of 2019, we estimated that duplicate accounts
`may have represented approximately 11% of our worldwide MAUs.
`We believe the percentage of duplicate accounts is meaningfully
`higher in developing markets such as the Philippines and Vietnam,
`as compared to more developed markets.21
`
`In the fourth quarter of 2020, we estimated that duplicate accounts
`may have represented approximately 11% of our worldwide MAUs.
`We believe the percentage of duplicate accounts is meaningfully
`
`
`18 Facebook 2016 10-K, p. 4, https://www.sec.gov/Archives/edgar/data/1326801/000132680117000007/fb-
`12312016x10k.htm.
`19 Facebook 2017 10-K, p. 4, https://www.sec.gov/Archives/edgar/data/1326801/000132680118000009/fb-
`12312017x10k.htm.
`20 Facebook 2018 10-K, p. 4.
`21 Facebook 2019 10-K, p. 4.
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 10 of 42 Page ID #10
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`higher in developing markets such as the Philippines and Vietnam,
`as compared to more developed markets.22
`
`In the fourth quarter of 2021, we estimated that duplicate accounts
`may have represented approximately 11% of our worldwide MAUs.
`We believe the percentage of duplicate accounts is meaningfully
`higher in developing markets such as the Philippines and Vietnam,
`as compared to more developed markets.23
`
`48. Meta’s SEC filings do not state whether the number of MAUs it reports annually is
`
`inclusive of, or exclusive of, the reported 11% of duplicate accounts.
`
`Since 2018, Meta Has Repeatedly Reported that, of its Worldwide Monthly Average Users,
`Approximately 5% are False Accounts
`
`Given its participation in the marketplace as a company that sells advertising in
`
`49.
`
`competition with other companies that sell advertising, Meta is aware that the number of false
`
`accounts on its platform is a metric that influences consumers purchasing advertising and therefore
`
`Meta’s bottom line.
`
`50.
`
`In every annual report since 2018, Meta has reported that approximately 5% of its
`
`worldwide MAUs are false accounts:
`
`In the fourth quarter of 2018, we estimate that false accounts may
`have represented approximately 5% of our worldwide MAUs.24
`
`In the fourth quarter of 2019, we estimated that false accounts may
`have represented approximately 5% of our worldwide MAUs.25
`
`In the fourth quarter of 2020, we estimated that false accounts may
`have represented approximately 5% of our worldwide MAUs.26
`
`In the fourth quarter of 2021, we estimated that false accounts may
`have represented approximately 5% of our worldwide MAUs.27
`
`
`22 Facebook 2020 10-K, p. 4.
`23 Meta 2021 10-K, p. 5.
`24 Facebook 2018 10-K, p. 4.
`25 Facebook 2019 10-K, p. 4.
`26 Facebook 2020 10-K, p. 4.
`27 Meta 2021 10-K, p. 5.
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 11 of 42 Page ID #11
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`51. Meta’s SEC filings do not state whether the number of MAUs it reports annually is
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`inclusive of, or exclusive of, the reported 5% of false accounts.
`
`Reach
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`52.
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`At all relevant times, to purchase advertisements on Meta, a consumer was required
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`to use Meta’s “Ads Manager” platform.
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`53. Meta describes Ads Manager as “an all-in-one tool for creating ads, managing when
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`and where they’ll run, and tracking how well [a consumer’s] campaigns are performing towards
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`[its] marketing goals.”28
`
`54.
`
`Prior to approximately March 2022, when an advertiser initiated an advertising
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`campaign on Meta, the first step on Ads Manager required the user to choose a campaign objective.
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`55.
`
`One objective that Meta offered was called “Reach.” Meta explained that this
`
`objective helps the advertiser “Show your ads to the maximum number of people,” as reflected in
`
`the screenshot below:
`
`
`28 https://www.facebook.com/business/tools/ads-manager (last accessed April 24, 2022).
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 12 of 42 Page ID #12
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`56. Meta further defined “reach” as “[t]he number of people who saw your ads at least
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`once. Reach is different from impressions, which may include multiple views of your ads by the
`
`same people.”29
`
`57.
`
`Upon information and belief, this definition of “reach” did not change during the
`
`Class Period.30
`
`58.
`
`On or about March 31, 2022, Meta removed “Reach” as a campaign objective.
`
`Meta’s website explained that it “consolidated the campaign objectives to make it easier to find
`
`one that aligns with your business goals,” as reflected in the screenshot below:
`
`
`
`
`29 https://www.facebook.com/business/help/710746785663278 (visited Oct. 28, 2021) (emphasis added).
`30 It remains the definition on Meta’s website as of July 7, 2022. Id.
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 13 of 42 Page ID #13
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`59.
`
`The “Learn More” link above indicates that the “Previous Objective Name” of
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`“Reach” now aligns with the “New Objective Name” of “Awareness.”
`
`Potential Reach (through late October 2021)
`
`60.
`
`After selecting its advertising campaign objective, the advertiser utilized Meta’s
`
`Ads Manager to identify its advertising targets, including the demographics of the desired target
`
`audience.
`
`61.
`
` Prior to approximately late October 2021, after advertisers selected their targeting
`
`and placement criteria, the Ads Manager displayed a “Potential Reach” for the advertisement.
`
`62.
`
`Potential Reach was one of only a few metrics provided to the ad-buyer prior to
`
`purchasing ads, and the only metric regarding the estimated size of the target audience that Meta
`
`provided prior to purchasing ads.31
`
`63. Meta explained, “Potential reach is an estimation of how many people are in an ad
`
`set’s target audience.”32
`
`64.
`
`The Potential Reach was expressed as a number of people that the ad may reach, as
`
`in the following example:
`
`
`
`
`31 Meta also provided a metric called “Estimated Daily Reach,” later revised to “Estimated Daily Results – People
`Reached,” which was based in part on the Potential Reach, and which provided “an idea of how many of the people
`in your target audience you may be able to reach on a given day.”
`32 https://web.archive.org/web/20190109200528/https://www.facebook.com/business/help/1665333080167380
`(emphasis added). In March 2020, Meta revised its definition of Potential Reach slightly: “Potential Reach estimates
`how many people your ad could potentially reach depending on the targeting and ad placement options you select
`while
`creating
`an
`ad.”
`https://web.archive.org/web/20200429194212/https://www.facebook.com
`/business/help/1665333080167380 (emphasis added).
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 14 of 42 Page ID #14
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`65. When an advertiser clicked on the “(i)” icon next to the Potential Reach figure, a
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`popup window stated, “Estimates are based on the placements and targeting criteria you select and
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`include factors like Facebook user behaviors, user demographics and location data. They’re
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`designed to estimate how many people in a given area could see an ad a business might run.
`
`They’re not designed to match population or census estimates. Numbers may vary due to
`
`performance reasons. Learn More.” (emphasis added and blue color in original).
`
`66. When an advertiser clicked on “Learn More,” the website stated: “Potential reach
`
`is an estimation of how many people are in an ad set’s target audience. . . . It updates in real time
`
`as you create or edit your ad set to help you understand how your targeting and placement choices
`
`affect the number of people you could reach.” (emphasis added).
`
`67.
`
`Prior to approximately late October 2021, the default Potential Reach number,
`
`before any targeting criteria were selected, was the Potential Reach for people in the United States
`
`aged 18 and up, which was shown during the Class Period to be more than 200 million people.
`
`As targeting criteria was selected, the Potential Reach was revised accordingly.
`
`Prior to approximately mid-March 2019, Meta calculated the Potential Reach using
`
`68.
`
`69.
`
`its MAU data.
`
`70. Meta did not disclose whether the Potential Reach figure that it provided excluded
`
`or included double-counting people with duplicate accounts or included “people” with false
`
`accounts.
`
`71.
`
`In approximately mid-March 2019, Meta announced, “Potential reach was
`
`previously calculated based on the number of total monthly active users on Facebook. . . . Now
`
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 15 of 42 Page ID #15
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`we’re only including people in potential reach who were shown an ad on Facebook in the last 30
`
`days.”33
`
`72.
`
`Based on this change, the number reflected in Potential Reach was likely to decline
`
`because it would be a subset of Monthly Active Users who, in the last 30 days, had been shown an
`
`ad as opposed to the larger number of total Monthly Active Users on the Facebook platform.
`
`73.
`
`In or about mid-March 2019, Meta also added language on its Help Center
`
`description of Potential Reach stating, “Estimates . . . may differ depending on facts such as: How
`
`many accounts are used per person . . . .”
`
`74. While this change indicated that one person could have multiple accounts, Meta
`
`still stated the Potential Reach was a measure of “people,” not accounts, and Meta continued to
`
`fail to disclose whether the Potential Reach figure included double-counting people with duplicate
`
`accounts or included “people” with false accounts.
`
`75.
`
`After these changes to Meta’s statements, the default Potential Reach number,
`
`before any targeting criteria was selected, remained the Potential Reach for people in the United
`
`States aged 18 and up, which was displayed to potential advertisers during the Class Period to be
`
`more than 200 million people.
`
`Meta Changed “Potential Reach” to “Estimated Audience Size”
`(late October 2021 to present)
`
`In or around late October 2021, Meta removed the “Potential Reach” metric and
`
`76.
`
`replaced it with a metric called “Estimated Audience Size.”
`
`77. Meta explained the change was to make the Potential Reach figure a range so it
`
`would be consistent with the format of the Estimated Daily Results:
`
`
`33 Facebook Business, Metrics Updates to Offer You More Actionable Business Insights, March 12, 2019
`https://www.facebook.com/business/news/metrics-updates-to-offer-you-more-actionable-business-insights.
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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 16 of 42 Page ID #16
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`Facebook provides pre-campaign estimates to help advertisers understand
`the estimated number of people who meet the targeting and ad placement
`criteria they select or how their ads may perform depending on those
`selections. These include Potential Reach, Estimated Daily Results and —
`if using interest categories — an estimate of the number of people who may
`have a particular interest.
`
`In order to make the presentation of those pre-campaign estimates
`consistent, we are changing Potential Reach and interests into ranges
`instead of specific numbers, which is how Estimated Daily Results are
`already presented. Ranges are also in line with how pre-campaign estimates
`are presented on other platforms across the advertising industry. As part of
`this update, we will also be changing the name of Potential Reach to
`Estimated Audience Size.34
`
`78.
`
`The default Estimated Audience Size, before any targeting criteria is selected, is
`
`the Estimated Audience Size for people in the United States aged 18 and up.
`
`79.
`
`On March 31, 2022, Meta’s default Estimated Audience Size for people in the
`
`United States aged 18 and up was 233,600,000 to 274,900,000, as shown in the screenshot below:
`
`
`34 https://www.facebook.com/business/news/update-to-our-pre-campaign-estimates (last visited Apr. 14, 2022).
`
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`

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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 17 of 42 Page ID #17
`
`80.
`
`On March 31, 2022, increasing the age range to all people in the United States aged
`
`13 and up increased the Estimated Audience Size to 243,600,000 to 286,600,000, as shown in the
`
`screenshot below:
`
`81.
`
`At some time between approximately late October 2021 and the present, Meta
`
`added the following language in a popup window that opens when the cursor is placed over the
`
`“(i)” next to the Estimated Audience Size figure:
`
`
`
`Estimated audience size is an estimate of how many people may
`meet your targeting criteria. It is based on factors such as targeting
`selections, ad placements and how many people were shown ads on
`Meta apps and services in the past 30 days.
`
`This is not an estimate of how many people will see your ad and is
`not designed to match population or census data. This metric is in
`development.
`
`(Blue color in original).
`
`82.
`
`This statement still represents the Estimated Audience Size as a number of “people”
`
`in the target audience.
`
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`

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`Case 3:22-cv-01455 Document 1 Filed 07/08/22 Page 18 of 42 Page ID #18
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`83.
`
`At some time between approximately late October 2021 and the present, Meta
`
`added the following language in a second popup window that opened by clicking on the “people”
`
`hyperlink in the popup window described in paragraph 81 above:
`
`Unique Metrics
`Unique metrics published on Facebook reporting surfaces are
`metrics that count the number of people who took an action, rather
`than the number of actions taken.
`
`These metrics are considered estimated and sampled, and depend on
`factors such as how many accounts are used by each person on
`Facebook Company Products. When a person has more than one
`account and takes actions (such as liking photos or adding
`comments) on the separate accounts, these actions may be counted
`separately even though they were made by the same person.
`
`For example, this means that if someone saw a post while using their
`business Page and then switched to their personal profile and saw
`the same post, we may count this as 2 people reached. This also
`means that in cases where a person has connected their Facebook
`and Instagram accounts in Accounts Center, they will be counted as
`a single person for ads measurement and estimation purposes, and
`in cases where a person has not connected their Facebook and
`Instagram accounts in Account Center, their accounts will be
`counted as multiple accounts for ads measurement and estimation
`purposes.
`
`Facebook has a number of systems in place to detect and remove
`fake accounts. In some cases, the presence of fake accounts may
`have some impact on unique metrics, such as estimated audience
`size.
`
`(Blue color in original).
`
`84.
`
`Upon information and belief, this explanation constituted Meta’s first time
`
`disclosing that it double-counts the same person in its Estimated Audience Size if that person has
`
`both a Facebook and Instagram account that are not linked.
`
`85.
`
`Upon information and belief, prior to this statement, Meta did not previously
`
`disclose that it was counting as mult