New York's Supreme Court Appellate Division announced that Facebook cannot challenge search warrants used by prosecutors to gain information from its site on hundreds of users believed to have committed Social Security fraud.
Reuters reported that the warrants for 381 users's photos, private messages and other data could only be challenged by the users themselves after prosecutors gained the evidence.
In its argument, Facebook received support from fellow internet giants Google Inc and Microsoft Corp. The companies argued that the ruling could set a precedent that granted prosecutors access to other type of digital data.
According to Reuters, Manhattan District Attorney's office served warrants to Facebook in 2013 as they searched for evidence against dozens who were later charged with Social Security fraud.
Facebook turned over the records to prosecutors in 2014 when a state judge threw out a complaint that the warrants violated users's Fourth Amendment rights. However, the company continued to pursue an appeal.
The company's spokesman told reporters it disagreed with the decision and would consider an appeal.
"We continue to believe that overly broad search warrants —granting the government the ability to keep hundreds of people's account information indefinitely— are unconstitutional and raise important concerns about the privacy of people's online information," Facebook said in a statement.
Meanwhile, a spokeswoman for the district attorney's office claimed prosecutors secured about $25m from those targeted by the warrants. Law enforcement agents have been able to use Facebook photos to show public employees riding jet skis, performing martial arts and playing golf to disprove the defendants's claims of physical disabilities.
"In many cases, evidence on their Facebook accounts directly contradicted the lies the defendants told the Social Security Administration," Joan Vollero said.
According to the Associated Press, 108 people have pleaded guilty to fraud thus far.