Nigerian govt, Meta agree to settle $32.8 million data privacy sanction out of court

The Nigerian government, through its data protection commission, and Meta Platforms Inc., parent company of Facebook and Instagram, have agreed on an out-of-court resolution of the $32.8 million fine imposed on the tech giant for alleged violation of Nigerian users’ data privacy rights.

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Both parties, through their lawyers, disclosed the development before Judge James Omotoso of the Federal High Court in Abuja on Friday, after the matter was called for ruling on a side issue regarding the main suit.

Meta’s lawyer, Fred Onwuobia, a Senior Advocate of Nigeria (SAN), urged the court to defer the ruling on the preliminary objection and the motion on notice to amend the case, saying the parties had “reached an advanced stage of settlement”.

He said settlement was the option both parties had resolved to pursue, noting that they were concerned the ruling could affect ongoing discussions. “The draft terms of settlement have been exchanged,” he said, urging the court to grant an adjournment for a report of settlement.

The lawyer to the Nigeria Data Protection Commission (NDPC), Adeola Adedipe, also a SAN, confirmed Meta’s position and said that the “settlement discussions have advanced appreciably.”

He also urged the court to adjourn so they could return with settlement terms for adoption as a “consent judgement.”

The judge, Mr Omotosho, said the court encouraged settlement and was “inclined not to deliver the ruling today.”

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He adjourned until 31 October for either a ruling or adoption of the settlement terms.

Alleged breaches and sanctions

The dispute began after the commission issued its Final Orders on 18 February imposing Meta a $32.8 million remedial fee and eight corrective directives over alleged violations of the law.

It explained that the decision followed a petition from the civil society group, the Personal Data Protection Awareness Initiative, which accused Meta of engaging in behavioural advertising on Facebook and Instagram without explicit consent from Nigerian users.

The NDPC accused Meta of processing data of non-users and failing to file its 2022 compliance audit. It also alleged the company transferred Nigerians’ personal data abroad without authorisation and processed sensitive information, including that of minors, for targeted advertising.

The commission ordered Meta to conduct a data processing impact assessment reflecting Nigeria’s privacy context, update privacy policies, seek express consent before behavioural advertising, and halt the transfer of personal data outside the country without approval.

But Meta rejected both the findings and the process that led to them.

Legal action

On 26 February, Meta Platforms Inc. (Meta’s full official name), filed an ex-parte motion seeking an order quashing NDPC’s compliance and enforcement orders dated 18 February.

The legal action ultimately sought the court’s order nullifying “all other investigations, proceedings and actions taken by respondent against the applicant leading to the ‘Final Orders.’”

On 4 March, Meta’s lawyer, Fred Onuofia, a Senior Advocate of Nigeria (SAN), moved the application, which judge James Omotosho partly granted.

The judge granted leave to Meta to commence judicial review proceedings against NPDC’s orders

However, he refused to grant Meta’s request for a stay of the proceedings of all matters relating to the “Final Orders” pending the hearing and determination of the judicial review proceedings.

The judge also issued an order for accelerated hearing of the main suit.

In reaction to the substantive suit, NDPC, through its lawyer, Mr Adedipe, filed a preliminary objection, contending that the suit was incompetent and the court lacked the jurisdiction to hear it.

The commission claimed Meta failed to comply with rules guiding judicial review under Order 34 of the Federal High Court (Civil Procedure) Rules, 2019.

In a 19 March filing, Meta said the NDPC denied it fair hearing and due process. Its lawyer, Gbolahan Elias, asked the Federal High Court to quash the enforcement orders, arguing they breached Section 36 of the Nigerian Constitution.

But NDPC’s lawyer contended that Meta was attempting to introduce new prayers after the court had ruled on its ex parte application. He maintained that amendment was not permitted under the rules of court.

Meta’s lawyers subsequently filed a motion on April 23 seeking permission to amend its initial statement to align it with its prayers.

After a hearing on 16 July, adjourned the matter until 3 October (Friday) for a consolidated ruling on NDPC’s preliminary objection and Meta’s motion to amend its filings.

The case was, on Friday, further adjourned until 30 October in deference to parties’ resolve to pursue settlement.

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Data protection efforts

The fine against Meta was part of efforts by the NDPC to enforce the Nigeria Data Protection Act, which President Bola Tinubu signed into law in June 2023.

In a similar action, the commission fined Multichoice Nigeria N766.2 million for breaching the same law.

It found that the Pay-TV operator violated the privacy rights of subscribers and their friends who were not subscribers and also carried out unauthorised cross-border transfers of Nigerians’ personal data.