Meta Hit with Competitor’s Lanham Act Class Action Over Advertising Reach

A putative class action filed on Friday said Meta Platforms Inc. competed unfairly against fellow digital advertising placement companies. The Southern District of Illinois complaint said that by exaggerating the efficacy of its advertising business, Facebook diverted customers away from competing companies like plaintiff Metroplex Communications Inc.

The action tracks others accusing Meta of making its Facebook and Instagram ad products sound better than they actually are. In late March, a class of people and businesses who purchased ads on Facebook secured class certification over Meta’s objections.

Now, Illinois-based Metroplex, which sells and places digital and targeted advertisements, says that Meta’s alleged misconduct also harmed competitors. In addition to inflating its “reach” estimates including audience size and campaign reach, the plaintiff says that the defendant is also guilty of “understating the number of duplicate accounts, understating the number of false accounts, [and] overstating the number of monthly active users in the United States and Canada.”

Noting that in 2021 Meta generated nearly $115 billion in advertising revenue, the complaint says that it has diverted business from competing advertisers and lessened the goodwill associated with their products in view of its misstatements.

The suit seeks certification of a nationwide class of all people or entities who, during the class period, operated a website or phone app and sold advertisements to third-parties to display on such websites or apps. The filing states causes of action under the Lanham Act for making misrepresentations in connection with its sale of advertising services and the Illinois Uniform Deceptive Trade Practices Act.

Further, Metroplex seeks damages and an order that Meta be required to implement a corrective advertising campaign.

The plaintiff is represented by Goldenberg Heller & Antognoli P.C. and Margulis Gelfand LLC.