Facebook Inc Facing Legal Action Over Ads Based On Racial Preference

Apple diversity reportPhoto by geralt (Pixabay)

Facebook is now being sued by a group of Facebook users over “discriminatory” house and job adverts. The users allege that Facebook’s “ethnic affinity” option is racially biased, according to the BBC. The option helps advertisers to better target users by excluding certain demographics.

Ethnic bias in housing and employment ads

According to the Courthouse News Service, the lead plaintiff in the lawsuit was named as Suzanne-Juliette Mobley. The case was filed in Northern California. The lawsuit also names about 9,999 advertisers as defendants. These advertisers used the platform “to discriminate based on race, gender, national origin and other protected attributes,” the plaintiffs claim.

The 14-page lawsuit claims that the use of such an option prevents some of the users from seeing ads, and this breaches the Fair Housing Act and the Civil Rights Act. Also the lawsuit notes that there is no option to exclude the demographic of “white or Caucasian Americans from the target audience.”

The basis of the lawsuit rests on the wording of Facebook’s ad-buy page. Under “Narrow audience,” the ad-buy page reads, “EXCLUDE people who match at least ONE of the following.” The page has Asian Americans, four categories of Hispanics and African American. Advertisers can even exclude demographic interest or behaviors.

Last month, Pro Publica – a public interest website – investigated ads for the housing market which excluded Asian Americans, Hispanics and African Americans. This finding triggered the lawsuit. According to the BBC, when the ads were shown to John Relman, a civil rights lawyer, he commented that they were “as blatant a violation of the federal Fair Housing Act as one can find.”

Lawsuit is without merit, claims Facebook

In its defense, the social networking giant said the lawsuit is “utterly without merit” and that it will challenge it “vigorously.” Such tools allow advertisers to experiment with various marketing strategies and focuses on affinities.

A Facebook spokesperson told the BBC, “We are committed to providing people with quality ad experiences, which includes helping people see messages that are both relevant to the cultural communities they are interested in and have content that reflects or represents their communities – not just generic content that’s targeted to mass audiences.”

The social networking giant says multicultural advertising must be seen as an instrument for “empowerment.” The company said it strongly prohibits advertisers from using these targeting options to discriminate and will “take prompt enforcement action when we determine that ads violate our policies.”

Many believe that such tools sometimes do have legitimate uses. Even the lawsuit says its aim is not to remove the “exclude people” function, which, according to it, has legal and desirable uses. Facebook’s head of multicultural, Christian Martinez, believes the “multicultural advertising options” helps users the find relevant content.

Facebook is also facing legal action over the use of fraudulent data in its advertising sales. Also CEO Mark Zuckerberg is facing a lawsuit over hate speech posts on th platform.

At 10:49 Eastern, Facebook shares were down 0.36% at $121.72. Year to date, the stock is up more than 16%, while in the last year, it is up almost 14%.

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About the Author

Aman Jain
Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at amanjain@valuewalk.com

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