NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ROSEMARIE VARGAS; et al., 

Plaintiffs-Appellants, 

and 

NEUHTAH OPIOTENNIONE; JESSICA 

TSAI, 

Plaintiffs, 

 v. 

FACEBOOK, INC., 

Defendant-Appellee.

No. 21-16499 

D.C. No. 3:19-cv-05081-WHO 

MEMORANDUM*

Appeal from the United States District Court

for the Northern District of California

William Horsley Orrick, District Judge, Presiding

Argued and Submitted July 28, 2022

Withdrawn January 9, 2023

Resubmitted June 20, 2023

San Francisco, California

Before: M. MURPHY,** GRABER, and OWENS, Circuit Judges.

Dissent by Judge OWENS.

* This disposition is not appropriate for publication and is not precedent 

except as provided by Ninth Circuit Rule 36-3.

** The Honorable Michael R. Murphy, United States Circuit Judge for 

the U.S. Court of Appeals for the Tenth Circuit, sitting by designation.

FILED

JUN 23 2023

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS
2 

Plaintiffs Rosemarie Vargas, Jazmine Spencer, Kisha Skipper, Deillo 

Richards, and Jenny Lin appeal from the dismissal of their Third Amended Class 

Action complaint against Defendant Facebook, Inc. We review the dismissal de 

novo, Meland v. Weber, 2 F.4th 838, 843 (9th Cir. 2021), and reverse and remand 

for further proceedings.

1. The district court erred by dismissing the operative complaint for failure 

to allege a concrete injury sufficient to confer Article III standing. Under Federal 

Rule of Civil Procedure 12, the bar to allege standing is not high. See Maya v. 

Centex Corp., 658 F.3d 1060, 1068 (9th Cir. 2011) (holding that “Twombly and 

Iqbal are ill-suited to application in the constitutional standing context”); see also

Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992) (“At the pleading stage, 

general factual allegations of injury resulting from the defendant’s conduct may 

suffice, for on a motion to dismiss we presume that general allegations embrace 

those specific facts that are necessary to support the claim.” (brackets omitted) 

(citation and internal quotation marks omitted)). And we must accept all factual 

allegations as true. See Warth v. Seldin, 422 U.S. 490, 501 (1975) (“For purposes 

of ruling on a motion to dismiss for want of standing, both the trial and reviewing 

courts must accept as true all material allegations of the complaint, and must 

construe the complaint in favor of the complaining party.”).

The operative complaint alleges that Facebook’s “targeting methods provide 
3 

tools to exclude women of color, single parents, persons with disabilities and other 

protected attributes,” so that Plaintiffs were “prevented from having the same 

opportunity to view ads for housing” that Facebook users who are not in a 

protected class received.

Plaintiff Vargas provides an example. She alleges that she is a disabled 

female of Hispanic descent and a single parent living in New York City with her 

two minor children and that she is a frequent Facebook user who has posted photos 

of herself and her children. Because of her use of Facebook, the platform knew 

that she was “a single parent, disabled female of Hispanic descent.” She sought 

housing from August 2018 through April 2019 and was ready, willing, and able to 

move. In an effort to find housing, she accessed the Facebook Marketplace. 

Although she sought housing in Manhattan, her Facebook searches yielded no ads 

for housing in Manhattan. After receiving unsatisfactory search results, in early 

2019, Plaintiff Vargas sat side by side with a Caucasian friend “and conducted a 

search for housing through Facebook’s Marketplace, both using the same search 

criteria . . . . [The Caucasian friend] received more ads for housing in locations 

that were preferable to Plaintiff Vargas. Plaintiff Vargas did not receive the ads

that [the friend] received.” Third Am. Compl. at 24 (emphases added). In other 

words, her Caucasian friend saw more, and more responsive, ads than Plaintiff 

Vargas received even though they used identical search criteria. See Havens 
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Realty Corp. v. Coleman, 455 U.S. 363, 373–74 (1982) (holding that racially 

diverse “testers” attempting to obtain truthful information about available housing 

had standing to sue under the Fair Housing Act of 1968).

The district court faulted the complaint for not identifying specific ads that

Plaintiff Vargas did not see. But Plaintiffs’ very claim is that Facebook’s practices 

concealed information from housing-seekers in protected classes. And nothing in 

the case law requires that a plaintiff identify specific ads that she could not see 

when she alleges that an ad-delivery algorithm restricted her access to housing ads 

in the first place. 

The district court also relied on the fact that only paid ads used Facebook’s 

targeting methods, and Plaintiffs do not specify whether the ads that Plaintiff 

Vargas’s Caucasian friend saw (and that Plaintiff Vargas did not) were paid ads. 

The operative complaint alleges that Facebook hosts a vast amount of paid 

advertising but does not allege that all ads on the Marketplace are paid ads. 

Nonetheless, given the allegations concerning the magnitude of paid advertising, it 

is plausible to infer that one or more of the ads that Plaintiff Vargas could not 

access because of Facebook’s methods was paid. If Plaintiff Vargas cannot prove 

that she was denied access to one or more paid ads, then her claims will fail on the 

merits—but they do not fail for lack of standing. See Cath. League for Religious 

& Civil Rts. v. City & County of San Francisco, 624 F.3d 1043, 1049 (9th Cir. 
5 

2010) (en banc) (“Nor can standing analysis, which prevents a claim from being 

adjudicated for lack of jurisdiction, be used to disguise merits analysis, which 

determines whether a claim is one for which relief can be granted if factually 

true.”). Plaintiff Vargas alleges a concrete and particularized injury—deprivation 

of truthful information and housing opportunities—whether or not she can 

establish all the elements of her claims later in the litigation.

2. The district court also erred by holding that Facebook is immune from 

liability pursuant to 47 U.S.C. § 230(c)(1). “Immunity from liability exists for ‘(1) 

a provider or user of an interactive computer service (2) whom a plaintiff seeks to 

treat, under a [federal or] state law cause of action, as a publisher or speaker (3) of 

information provided by another information content provider.’” Dyroff v. 

Ultimate Software Grp., 934 F.3d 1093, 1097 (9th Cir. 2019) (quoting Barnes v. 

Yahoo!, Inc., 570 F.3d 1096, 1100 (9th Cir. 2009)). We agree with Plaintiffs that, 

taking the allegations in the complaint as true, Plaintiffs’ claims challenge 

Facebook’s conduct as a co-developer of content and not merely as a publisher of 

information provided by another information content provider.

Facebook created an Ad Platform that advertisers could use to target 

advertisements to categories of users. Facebook selected the categories, such as 

sex, number of children, and location. Facebook then determined which categories 

applied to each user. For example, Facebook knew that Plaintiff Vargas fell within 
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the categories of single parent, disabled, female, and of Hispanic descent. For 

some attributes, such as age and gender, Facebook requires users to supply the 

information. For other attributes, Facebook applies its own algorithms to its vast 

store of data to determine which categories apply to a particular user. 

The Ad Platform allowed advertisers to target specific audiences, both by 

including categories of persons and by excluding categories of persons, through the 

use of drop-down menus and toggle buttons. For example, an advertiser could 

choose to exclude women or persons with children, and an advertiser could draw a 

boundary around a geographic location and exclude persons falling within that 

location. Facebook permitted all paid advertisers, including housing advertisers, to 

use those tools. Housing advertisers allegedly used the tools to exclude protected 

categories of persons from seeing some advertisements. 

As the website’s actions did in Fair Housing Council of San Fernando 

Valley v. Roommates.com, LLC, 521 F.3d 1157 (9th Cir. 2008) (en banc),

Facebook’s own actions “contribute[d] materially to the alleged illegality of the 

conduct.” Id. at 1168. Facebook created the categories, used its own 

methodologies to assign users to the categories, and provided simple drop-down 

menus and toggle buttons to allow housing advertisers to exclude protected 

categories of persons. Facebook points to three primary aspects of this case that 

arguably differ from the facts in Roommates.com, but none affects our conclusion 
7 

that Plaintiffs’ claims challenge Facebook’s own actions.

First, in Roommates.com, the website required users who created profiles to 

self-identify in several protected categories, such as sex and sexual orientation. Id.

at 1161. The facts here are identical with respect to two protected categories

because Facebook requires users to specify their gender and age. With respect to 

other categories, it is true that Facebook does not require users to select directly 

from a list of options, such as whether they have children. But Facebook uses its 

own algorithms to categorize the user. Whether by the user’s direct selection or by 

sophisticated inference, Facebook determines the user’s membership in a wide 

range of categories, and Facebook permits housing advertisers to exclude persons 

in those categories. We see little meaningful difference between this case and 

Roommates.com in this regard. Facebook was “much more than a passive 

transmitter of information provided by others; it [was] the developer, at least in 

part, of that information.” Id. at 1166. Indeed, Facebook is more of a developer 

than the website in Roommates.com in one respect because, even if a user did not 

intend to reveal a particular characteristic, Facebook’s algorithms nevertheless 

ascertained that information from the user’s online activities and allowed 

advertisers to target ads depending on the characteristic.

Second, Facebook emphasizes that its tools do not require an advertiser to 

discriminate with respect to a protected ground. An advertiser may opt to exclude 
8 

only unprotected categories of persons or may opt not to exclude any categories of 

persons. This distinction is, at most, a weak one. The website in Roommates.com

likewise did not require advertisers to discriminate, because users could select the 

option that corresponded to all persons of a particular category, such as “straight or 

gay.” See, e.g., id. at 1165 (“Subscribers who are seeking housing must make a 

selection from a drop-down menu, again provided by Roommate[s.com], to 

indicate whether they are willing to live with ‘Straight or gay’ males, only with 

‘Straight’ males, only with ‘Gay’ males or with ‘No males.’”). The manner of 

discrimination offered by Facebook may be less direct in some respects, but as in 

Roommates.com, Facebook identified persons in protected categories and offered

tools that directly and easily allowed advertisers to exclude all persons of a 

protected category (or several protected categories).

Finally, Facebook urges us to conclude that the tools at issue here are 

“neutral” because they are offered to all advertisers, not just housing advertisers, 

and the use of the tools in some contexts is legal. We agree that the broad 

availability of the tools distinguishes this case to some extent from the website in

Roommates.com, which pertained solely to housing. But we are unpersuaded that 

the distinction leads to a different ultimate result here. According to the complaint, 

Facebook promotes the effectiveness of its advertising tools specifically to housing 

advertisers. “For example, Facebook promotes its Ad Platform with ‘success 
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stories,’ including stories from a housing developer, a real estate agency, a 

mortgage lender, a real estate-focused marketing agency, and a search tool for 

rental housing.” A patently discriminatory tool offered specifically and knowingly

to housing advertisers does not become “neutral” within the meaning of this 

doctrine simply because the tool is also offered to others.

REVERSED and REMANDED.
1

Vargas v. Facebook, Inc., No. 21-16499

OWENS, Circuit Judge, dissenting:

I respectfully dissent. Each of Plaintiffs’ theories of injury—denial of 

truthful information, denial of the opportunity to obtain a benefit, denial of the 

social benefit of living in an integrated community, and stigmatic injury—depends 

on Plaintiffs having been personally discriminated against by at least one housing 

advertiser that used Facebook’s Ad Platform. Thus, to survive a motion to dismiss, 

Plaintiffs would need to plausibly allege that a housing ad that would otherwise 

have appeared in their News Feeds or in their search results on Facebook 

Marketplace did not appear because the advertiser used Facebook’s Ad Platform to 

exclude their protected class. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555-

57 (2007); Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009). 

As to each named plaintiff, the Third Amended Complaint (“TAC”) does not 

identify any such ad or advertiser. Nor does it allege facts supporting an inference 

that housing discrimination (even if the identities of the ads and advertisers are 

unknown) is plausibly the reason Plaintiffs failed to find housing ads meeting their 

respective search criteria. Plaintiffs have alleged nothing to exclude the possibility 

that suitable housing was not available or not advertised on Facebook. See Iqbal, 

556 U.S. at 682 (finding that an allegation of discrimination was not plausible in 

view of one “obvious alternative explanation”).

FILED

JUN 23 2023

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS
2

Although Vargas alleges in Paragraph 95 of the TAC that her Caucasian

friend, while using the same search criteria, received ads on Facebook Marketplace 

that she did not, she does not specify whether the ads her Caucasian friend saw

were user-generated or paid (i.e., created using the Ad Platform and its audience 

selection tools). Users can distinguish paid ads from user-generated ads by the 

label “Sponsored.” See Andrew Hutchinson, Facebook Provides New Option to 

Boost Marketplace Posts, and Marketplace Ads for Businesses, SocialMediaToday

(June 7, 2018), https://www.socialmediatoday.com/news/facebook-provides-newoption-to-boost-marketplace-posts-and-marketplace-ad/525158/. Only paid ads are 

relevant to Vargas’s housing discrimination claims.

Accordingly, I would affirm the district court’s dismissal for failure to allege 

a concrete injury sufficient to confer standing.