Meta ex-COO Sandberg sanctioned in investor lawsuit for deleting emails

By Tom Hals

WILMINGTON, Delaware (Reuters) – Meta Platforms (NASDAQ:)’ former chief operating officer, Sheryl Sandberg, was sanctioned by a judge on Tuesday for deleting emails related to litigation over Facebook’s Cambridge Analytica privacy scandal, despite being told to preserve the messages.

The judge, Vice Chancellor Travis Laster, of Delaware Chancery Court, said evidence showed Sandberg used a personal account under a pseudonym and erased messages that were likely relevant to the shareholder lawsuit.

The sanction will make it harder for Sandberg to tell her side of the story and avoid liability at the eight-day, non-jury trial scheduled for April. The judge also ordered her to pay the expenses related to the sanctions motion incurred by the shareholders, which include California’s huge teachers’ retirement system known as CalSTRS.

“Because Sandberg selectively deleted items from her Gmail account, it is likely that the most sensitive and probative exchanges are gone,” Laster wrote in his opinion published on Tuesday.

Meta and an attorney for Sandberg did not immediately respond to a request for comment.

Sandberg had argued she was forthcoming about the personal account and rarely used it for business and when she did, others were copied on the messages so the information was preserved.

Laster imposed a higher standard of “clear and convincing evidence,” rather than “preponderance” of evidence, for Sandberg’s affirmative defenses, which are her arguments and evidence for why she should not be held liable.

The case was brought in 2018, when it emerged that Facebook allowed data from millions of users to be accessed by Cambridge Analytica, a political consulting firm that worked for Donald Trump’s successful campaign for U.S. president in 2016.

Shareholders sued the company’s directors and officers for allegedly harming investors by continually violating a 2012 consent order with the Federal Trade Commission to protect users’ data.

Shareholders also allege the company’s board bargained to pay a larger fine of $5 billion to the FTC in 2019 so that founder Mark Zuckerberg would not have personal accountability. Zuckerberg is expected to be deposed for a second time before the start of the trial, according to court records.

In 2023, Laster refused to dismiss the lawsuit, which he said was a “case involving alleged wrongdoing on a truly colossal scale.”

Shareholders also asked Laster to sanction Jeffrey Zients, who was former President Joe Biden’s chief of staff and who also used and deleted personal emails when he was on Meta’s board. The judge said that Zients’ messages were less pertinent because he joined the Meta board in 2018, after the Cambridge Analytica scandal, and was not a company officer.