Zuckerberg, Sandberg, and more reached a deal with shareholders who claimed Facebook overpaid to shield its CEO from the Cambridge Analytica scandal
David Paul Morris/Bloomberg via Getty Images
Meta $META Platforms and a group of its current and former top executives — including CEO Mark Zuckerberg and ex-COO Sheryl Sandberg — have reached a settlement with investors who accused them of breaching fiduciary duties and causing billions in financial damage to the company by prioritizing Zuckerberg’s personal legal protection over the company’s interests.
The surprise deal was struck just one day into a Delaware Court of Chancery trial, halting what had promised to be a headline-grabbing week of testimony from tech heavyweights including Zuckerberg, Sandberg, venture capitalist Marc Andreessen, Netflix $NFLX co-founder Reed Hastings, and Palantir $PLTR’s Peter Thiel.
Terms of the settlement, which were not disclosed, are expected to be finalized in the coming weeks.
The lawsuit stems from Facebook’s now-infamous settlement with the Federal Trade Commission, in which the company paid a record $5 billion fine over the Cambridge Analytica scandal — a breach that allowed data from tens of millions of users to be harvested without consent.
Meta shareholders argued that the company overpaid in that deal to shield Zuckerberg personally from legal exposure. The plaintiffs claimed that Meta’s board, led by Zuckerberg and other insiders, prioritized protecting the CEO over minimizing damages to the company. They were seeking as much as $8 billion in damages.
Meta itself was not named as a defendant in the case. Instead, the lawsuit targeted 11 individual executives and board members — including Zuckerberg, Sandberg, and Andreessen — accusing them of running Facebook as an “illegal data harvesting operation.”
While Meta has consistently denied wrongdoing, the lawsuit raised significant questions about the company's board oversight, executive accountability, and whether insiders at one of the world’s largest tech companies put personal reputations ahead of shareholder value.
On Wednesday, plaintiffs’ expert witnesses pointed to “gaps and weaknesses” in Facebook’s privacy practices, although they stopped short of declaring a breach of the 2012 FTC agreement that preceded the $5 billion fine. Former board member Jeffrey Zients, now White House Chief of Staff, testified that Zuckerberg was not being shielded by the board and that the company agreed to the settlement in good faith.
Zuckerberg and Sandberg were both scheduled to testify next week, a prospect that could have brought renewed scrutiny to the decisions made in the wake of the Cambridge Analytica revelations.
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