The Regional Court of Frankfurt am Main has strengthened the liability of major platform operators. According to a ruling (case no. 2-06 O 234/25), Meta Platforms is liable for fraudulent advertisements and fake profiles on Instagram and Facebook if the content is steered and distributed by in-house algorithms serving its own economic interests.
Identity theft for fraudulent investments
The lawsuit was triggered by persistent identity theft: Criminals repeatedly set up profiles under the name of a German financial advisory portal and its prominent founder. They also ran paid advertisements on Meta. The links directed users to WhatsApp groups where they were promised purported investment products from the company founder. Deceived investors lost the funds they had deposited and subsequently lodged complaints with the legitimate business.
At times, the affected portal employed a full-time staff member solely to report fake profiles and ads—more than 250 times in a single summer month in 2024 alone. Meta sometimes took 14, 20, or even 62 days to respond and refused to implement preventive measures beyond processing individual reports.
Algorithms negate safe harbor protections
In court, Meta invoked the liability privilege for third-party content under the E-Commerce Directive and the Digital Services Act (DSA). The Regional Court rejected this defense, citing European Court of Justice (ECJ) case law. The privilege applies only to purely passive platforms. Because Meta auctions off advertising space and calculates rankings based on quality criteria such as text volume or sensationalist language, the company exercises superior control over how content is served.
The court identified the same controlling function in standard posts that are algorithmically distributed into other users’ feeds to drive commercial success. Entities that curate content to maximize their own profits control that content and are liable for it—regardless of specific awareness in any individual instance.
Fines and damages for Meta
The ruling established violations of corporate personality rights as well as the founder’s right to their name and personal rights. Copyright infringement claims were dismissed, however, because unbroken chains of contracts establishing exclusive rights to the used images were not provided.
Meta must prevent future violations of this nature under threat of an administrative fine of up to 250,000 euros per instance. Furthermore, the corporation must disclose advertising revenues and impression numbers so that damage claims can be quantified. The ruling is not yet legally binding.
All-clear for forums and Mastodon
Operators of online forums and purely chronological platforms such as Mastodon can breathe a sigh of relief: Because they do not use algorithms to curate content for their own financial benefit, the decision primarily targets platforms featuring commercially driven feeds.
What does this mean for consumers?
For users, the ruling represents a significant step against rogue advertising networks on social media. Platforms may no longer tolerate fraudulent ads featuring well-known personalities for weeks on end. Nonetheless, users should remain fundamentally cautious regarding investment offers on social networks: Legitimate financial service providers do not conduct business through private WhatsApp groups. Suspicious profiles and advertisements should continue to be reported directly via the platform’s built-in tools.
Sources: Heise – News
