Citing 80,000 pages of internal Facebook documents obtained during court proceedings, the plaintiffs claim the company had already received several inquiries about suspect video metrics by July 2015 and soon determined the cause, but did not follow up on those inquiries for a full year. They also claimed the error didn't affect billing, though with viewership metrics inflated 150 to 900 percent, it's easy to see how advertisers might have seen the inflated numbers as incentive to buy more ads.
"In an internal response to one such inquiry, a Facebook engineer discussed the numerator/denominator mismatch: 'I remember [another Facebook engineer] mentioned when computing the average, we only consider views greater than three seconds, but use the total watch time (including those under three [seconds]),'" the lawsuit says.
The lawsuit refers back to a disclosure Facebook made in 2016, when it admitted that it inadvertently had been overstating some video viewing metrics. In it, the plaintiffs say that, as part of the discovery from their lawsuit, they have learned that Facebook's "action rises to the level of fraud and may warrant punitive damages". When the issue came to light, Facebook said it overestimated average time spent watching video ads by as much as 60 to 80 percent. They allege Facebook's misrepresentations led them to believe that Facebook's video ads were more valuable than they actually were, resulting in inflated prices. Some have also posited that Facebook's heavy push of video encouraged many news groups to lay off writers and transition to more video-laden strategies that did not perform for them.
Facebook moved to dismiss the fraud claim, stating the lawsuit is baseless and that it informed customers of the problem with its metrics when it was discovered. "Yet Facebook did nothing to stop its dissemination of false metrics", the marketers allege in the amended complaint, filed with U.S. District Court Judge Jeffrey White in Oakland.
"About a month ago, we found an error in the way we calculate one of the video metrics on our dashboard-average duration of video viewed", David Fischer, a Facebook vice president, wrote.
"Suggestions that we in any way tried to hide this issue from our partners are false", a Facebook spokeswoman reportedly said.
Facebook is accused of trying to hide inflated advertising metrics.