Tech companies Google and Meta are each facing class-action lawsuits from taxpayers who say the companies collected sensitive information from them via special tracking pixels placed on filing websites.
The suits come in the wake of reports that prominent tax filing solutions providers were leaking sensitive information to the companies through trackers (see previous story). Such trackers, commonly used throughout the internet, are generally used to train algorithms as well as optimize direct marketing campaigns. These trackers were used to collect personal information ranging from only usernames and the last device used to actual financial data, including in some cases filing status, adjusted gross income and refund amounts. While names were obscured, the process used to do so can be easily reversed.
The allegations were confirmed in a Senate report released last month (see previous story). The Senate report named three companies — H&R Block, TaxAct and TaxSlayer — as having shared the private information of millions of taxpayers by using tracking tools that connect to third parties.
The three companies named, according to the report, confirmed their software has used tracking pixels for "at least a couple of years" and told the investigators their use is ubiquitous across the industry. Some of these trackers collect information on a user's filing status, approximate adjusted gross income, approximate refund amount, names of dependents, amount of federal tax owed, the buttons a user clicked and the text-entry forms they navigated (which could indicate whether a taxpayer was eligible for certain deductions or exemptions), and their full name, email address, country, city, state, zip code, phone numbers and gender. Further, the trackers collected information about other sites a user has visited that might reveal information about a specific tax situation, such as whether they have dependents, rental income or capital gains.
Taxpayers are suing the companies for collecting this information. The Google suit accuses the company of "wiretapping" people and, as a result, U.S. consumers have been involuntarily transmitting their sensitive financial information to Google when they file their taxes online. It said that Google either knew, or turned a blind eye to, the disclosure of tax return information without consent, which is a crime. It noted that the kind of information collected is highly valuable for analytics and marketing purposes.
The suit against Meta (the parent company of Facebook and other services like WhatsApp and Threads), which was filed late last year, makes similar arguments. Plaintiffs said the company, through tracking pixels, was collecting highly sensitive taxpayer information in violation of privacy laws.
Google, according to Forbes, is arguing that the plaintiffs are going after the wrong company, saying it is up to the sites to determine what information they do and do not collect and it was their responsibility to disclose this data sharing to users. Meta raised a similar defense, saying it was not the tracking pixel that was the problem but the way the sites configured it — it is possible to make it so trackers do not collect sensitive information, and it was up to the site owners to do so.
The Meta case, also filed in the U.S. District Court for the Northern District of California, is In Re Meta Pixel Tax Filing Cases, case number 3:22-cv-07557. The Google case is Adams et al. v. Google, LLC, case number 5:23-cv-04191, in the U.S. District for the Northern District of California. Both have been filed as class-action lawsuits.
