Google settles for $350 million in a lawsuit over concealing a security bug in Google+. Shareholders alleged the company hid the glitch, leading to a market value loss. Google denies any wrongdoing, stating the matter concerns a discontinued product.
AT A GLANCE
- $350 Million Settlement: Google agrees to pay $350 million to settle a lawsuit over a security bug at its former Google+ social media site.
- Hidden Software Glitch: Lawsuit claims Google concealed a three-year software glitch in Google+ that exposed user data, despite knowing about it in March 2018.
- Market Impact: Allegations caused Alphabet shares to drop, wiping out billions in market value as news about the bug spread.
- Fear of Scrutiny: Shareholders argue Google hid the bug to avoid scrutiny similar to Facebook’s Cambridge Analytica scandal during the 2016 U.S. elections.
- Rhode Island Treasurer’s Lawsuit: Lawsuit led by Rhode Island Treasurer covers Alphabet shareholders from April 2018 to April 2019.
- Google Denies Wrongdoing: Google denies wrongdoing, stating they found no evidence of data misuse, and the settlement resolves a matter related to a now-defunct product.
- Related Settlement: In 2020, Google reached a $7.5 million settlement with Google+ users; lawyers for shareholders may seek up to $66.5 million in fees from the current settlement.
Google Settles Data Privacy Lawsuit for $350 Million Over Google+ Security Bug
Mountain View, CA (February 8, 2024) – Google has agreed to pay $350 million to settle a class-action lawsuit filed by shareholders related to a security bug that exposed personal data of millions of Google+ users. The settlement, filed on February 6th in San Francisco federal court, brings to a close a long-running legal battle that accused Google of concealing the vulnerability for months while downplaying the severity of the breach.
The lawsuit stemmed from a software glitch discovered in March 2018 that left the profiles of millions of Google+ users exposed to third-party app developers, even after users had restricted access. While Google patched the vulnerability within days, they did not publicly disclose the incident until October 2018, prompting accusations of a cover-up.
Shareholders alleged that Google’s decision to withhold information about the bug misled investors and artificially inflated the company’s stock price. They further claimed that the public revelation of the breach caused the stock price to plummet, resulting in significant financial losses.
Terms of the Settlement and Lingering Concerns
The $350 million settlement resolves these claims without any admission of wrongdoing by Google. However, it highlights the potential financial consequences of data breaches and the importance of transparency in corporate communication. In addition to the shareholder payout, Google previously reached a separate $7.5 million settlement with Google+ users affected by the security bug in 2020.
While the settlement marks the end of this specific legal battle, concerns about data privacy and tech giants’ handling of user information remain. The Google+ incident is just one example of a growing trend of data breaches at major technology companies, raising questions about accountability and regulatory oversight.
The Google+ data breach and subsequent lawsuit underscore the critical need for companies to prioritize data security and user privacy. As technology evolves, so too must regulations and industry best practices to ensure that user data is adequately protected and that companies are held accountable for any breaches that occur.
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