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Facebook parent company Meta must face a lawsuit over claims it breached its terms of service by soliciting fraudulent advertisements from Chinese companies, a federal appeals court has ruled.

Christopher Calise and Anastasia Groschen sued Facebook in 2022 after they bought items advertised on Facebook. Mr. Calise’s car engine assembly kit did not arrive. Ms. Groschen’s toddler activity board did arrive, but it was a puzzle, not a board.

The pair said Facebook was unjustly enriching itself and being negligent by not only accepting but soliciting ads from scammers. That included efforts to solicit ads from China-based advertisers, despite internal data indicating nearly three-in-10 such ads violated one or more Facebook policies.

They also said that Facebook was breaching the contract it made with users when it stated in its terms of service that if it learned of harmful conduct, “we will take appropriate action,” but instead solicited, encouraged, and assisted deceptive advertisers.

The entire case was thrown out by U.S. District Judge Jeffrey White, who ruled the claims were barred by Section 230 of the Communications Decency Act.

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