Facebook Hit with Discrimination Class Action Alleging Older, Female Users Are Not Shown Financial Services Ads

Facebook finds itself as the defendant in yet another proposed class action, with the latest suit alleging the embattled social media company has discriminatorily denied older and female users the opportunity to receive advertising and information on financial services opportunities.

Citing California’s Unruh Civil Rights Act, the 24-page complaint out of the state’s Northern District alleges that those on the receiving end of Facebook’s apparent discrimination have been denied the opportunity to learn about and obtain “mortgages, personal loans, bank accounts, insurance, investment opportunities, and financial consulting services” within at least the last three years. The root of the problem, according to the lawsuit, lies with Facebook’s overall advertising and business practices, as well as with what the plaintiff claims is the company’s “aiding and abetting” of financial service firms’ discriminatory advertising and business tactics.

“Due to Facebook’s discriminatory practices, millions of older and female Facebook users have been denied the opportunity to receive valuable advertisements about financial services opportunities that advertisers sent to younger persons and men, and to pursue those financial services opportunities within and outside of Facebook,” the lawsuit charges. As the plaintiff tells it, Facebook’s conduct has served to deny its own users the “full and equal accommodations, advantages, facilities, and services” offered on the social media platform.

Age and gender as conditions of use

The lawsuit minces no words in alleging Facebook’s discriminatory conduct starts the moment an individual creates an account. The complaint points out that all Facebook users must provide their age and gender as a condition of using the website; once Facebook has this information, the case says, the platform then segregates and classifies users based on their genders and ages—primarily as a means for advertisers to target ads within those parameters.

With this segmenting in place from the get-go, Facebook, the lawsuit claims, encourages financial services advertisers to disseminate ads that exclude certain Facebook users based on age and gender. Such advertisers generally follow Facebook’s suggestions, and “routinely” place financial services ads on the defendant’s platform that exclude older persons and women as a means of optimizing ad performance, the suit alleges.

Facebook’s advertising capabilities

The lawsuit explains that the ability to target consumers with advertisements is an extremely powerful tool for advertisers, and Facebook’s ad targeting, from which it pulls in a sizeable amount of revenue, affords companies a great deal of precision with regard to who they’d like to see their content. In that regard, it’s a requirement for companies looking to advertise on Facebook to select the audience, i.e. a particular segment of users, they wish to see a particular ad. Put simply, those who fall outside of an advertiser’s designated audience will not have the opportunity to view a particular paid advertisement.

Echoing Facebook’s account creation requirements, audience selection for advertisers includes establishing three basic parameters: age, gender and location of those meant to view an ad. And Facebook, per the case, actively encourages advertisers to keep their audiences narrow, at least when it comes to age and gender, in order to target ads more effectively. According to the lawsuit, this tactic sometimes involves excluding women and older users from an audience, which, the case argues, benefits advertisers and Facebook alike:

Upon information and belief, Facebook encourages, facilitates, expects, knows, and wants advertisers to routinely exclude older persons and women from their audience selections so that older persons and women will not receive advertisements on Facebook, including advertisements for financial services opportunities. Facebook encourages, facilitates, enables, and executes on the exclusion of older persons and women from receiving information and advertisements, because such age- and gender-based exclusions are central to Facebook’s business model, including because Facebook wants ads to be as ‘relevant’ as possible to its users so that users will spend more time on Facebook and allow Facebook to sell and place more paid advertisements on Facebook.”

The case stresses that no Facebook user is exempt from how their demographic details are handled with regard to advertisers’ audiences wishes—in no small part because users cannot opt out of telling the company their gender and age—no more than advertisers can opt out of selecting specific ages and genders to which to target ads.

Facebook already chastised for credit-related ad exclusions

As the lawsuit tells it, Facebook has been on “specific notice” for at least three years with regard to its discriminatory advertising and business practices as they relate to financial services opportunities. While the company has been told of and is reportedly aware that its practices serve to “classify and segregate” users based on age and gender, among other protected characteristics, Facebook, the lawsuit stresses, “has not changed its practices” with regard to pushing financial services advertisers to intentionally narrow who gets to see their ads.

The case points out that Facebook, despite knowing as early as 2017 that financial services companies were attempting to buy credit-related ads that would exclude from audiences certain users of specific ages and genders, “intentionally approved, sold, and sent numerous credit-related advertisements” for which older persons and women were left out of the audience. The resulting uproar, the lawsuit goes on, led Facebook in September 2019 to put in place new rules that supposedly banned advertisers from placing ads for credit-related opportunities that discriminated against users on the basis of age and gender.

The lawsuit alleges, however, that despite this move, Facebook has continued to leave out older users and women with regard to “all other financial services opportunities,” exempting those involving credit.

“There is no lawful or legitimate basis to exclude older persons or women from receiving the full and equal accommodations, advantages, facilities and services of Facebook and the financial services companies that advertise financial services opportunities via Facebook,” the lawsuit says.

The plaintiff, a 54-year-old Washington D.C. resident, claims that she, within the last year, periodically searched for housing and financial services opportunities on Facebook, specifically with regard to information about loans and insurance via advertisements. The woman argues that while she would have willingly clicked on such advertisements had she seen them, Facebook and the financial services companies with whom it works “have routinely used Facebook’s audience selection tools” to exclude users such as herself from receiving the ads. Each instance of this alleged discrimination is a violation of California’s Unruh Civil Rights Act, the plaintiff alleges.

Who does the lawsuit look to represent?

Included in the proposed class are all Facebook users in the U.S. who, within the last three years and through the date of any eventual judgment:

  The lawsuit can be read below.