In the Matter of Alexsandr Kogan and Alexander Nix

Researchers at the University of Cambridge developed an algorithm that could predict a person’s personality based on which public pages the person liked on Facebook’s social-media platform. SCL Elections (SCL), working with Cambridge Analytica, LLC (defendant), wanted to harness that research to offer voter profiling, targeting, and other marketing services to political campaigns and commercial clients. They contacted Alexsandr Kogan (defendant), who had an existing Facebook app that could be repurposed to collect profile data from app users and their Facebook friends. Kogan incorporated a new entity, GSR, for the project, with himself as CEO. He reworked and rebranded his existing app to become the GSRApp. SCL, acting on Cambridge Analytica’s behalf, entered an agreement with GSR under which GSR agreed to harvest Facebook data from app users and their friends, generate personality profiles, and match the profiles to voter records. Alexander Nix (defendant) signed the agreement for SCL, regularly communicated with Kogan regarding the project, and provided guidance on the data to be collected. Users for the GRSApp were recruited via survey requests that offered a small fee if a user completed the survey and authorized the app to collect Facebook data. Regarding the authorization, the app expressly represented that it would not download a user’s name or other identifying information but was instead focused only on demographic information and page likes. That representation was false. The app collected users’ Facebook user IDs, gender, birthdate, location, friend lists, and page likes. Additionally, the app harvested the user IDs, names, genders, birthdates, locations, and page likes of each user’s Facebook friends. In total, the project collected profile data from over 250,000 app users and 50 million friends of app users. The parties discontinued the project around May 2015. In December, Cambridge Analytica’s use of Facebook data was reported by news outlets, sparking public outcry. The Federal Trade Commission (FTC) (plaintiff) filed a complaint against Kogan individually and against Nix both individually and in his then capacity as CEO of Cambridge Analytica. The FTC alleged that Kogan, Nix, and Cambridge Analytica violated the FTC Act by engaging in a deceptive trade practice. Negotiations resulted in the entry of a consent order agreed to by the parties.