Facebook $20m Privacy Settlement

A couple of days ago, on August 27, 2013 Facebook has agreed to make changes to its Statement of Rights and Responsibilities as part of a $20m settlement covering the use of names and likenesses in advertising.  A California judge on Monday gave final approval to a $20m (£13m) settlement in a class action lawsuit that had charged Facebook with violating users’ privacy through the use of their names and likenesses in its Sponsored Stories advertising program.  That being said, privacy advocates objected that the settlement’s terms do not go far enough, but United States District Judge Richard Seeborg in San Francisco found that the settlement, “while not incorporating all features that some of the objectors might prefer, has significant value“.

Privacy changes

The settlement will now see payments of $15 each to be distributed to Facebook members who submitted valid claims, with other expenses such as attorneys’ fees and administrative costs are also to be paid through the settlement fund. Facebook is also be required to make changes to its Statement of Rights and Responsibilities which will give users more information about and control over the use of their names and likenesses by Facebook.  The settlement covers about 150 million users whose names and likenesses were allegedly misappropriated in connection with the Sponsored Stories program.  Plaintiff lawyers estimated these changes have a value of up to $145 million in themselves. Advertisers paid Facebook nearly $234 million through Sponsored Stories between the period of January 2011 and August 2012.  Sponsored Stories displays a user’s name and profile image and a tagline indicating that the user “Liked” an advertiser. Initially the messages were displayed in the site’s right-hand column, but were later moved directly into a user’s news feed.

The program is part of Facebook’s drive to derive profits from the personal data of its users. The company has been under investor pressure to enlarge such profits since a massively disappointing flotation on the market last year.

Controversy

Privacy groups such as Public Citizen have argued that the changes still place the yoke upon users, or in the case or minors, upon the parents of users, to opt out of advertising programs such as Sponsored Stories.  Public Citizen have argued that users should rather be presented with an “opt-in” for such programs and that in the case of minors, such an “opt-in” measure is required by law in the US states of California, Florida, Tennessee, Virginia, Wisconsin, New York and Oklahoma.  A staff attorney with Public Citizen, Scott Michelman, said that the ruling “gave short shrift to kids’ online privacy rights and will enable Facebook to continue exploiting minors’ images for profit in violation of the laws of seven states”.  A Facebook spokesman said the company is “pleased that the settlement has received final approval”.  In related news, Facebook faces a possible EU lawsuit in Ireland based on a privacy campaign launched by an Austrian law student.  We await the outcome of that trial, once again with eager anticipation.

[Image Via afr]

SOURCE: http://www.techweekeurope.co.uk/news/facebook-privacy-125728