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Judge Rejects Settlement in Facebook "Sponsored Stories" Case

A federal judge has rejected a proposed settlement in a class-action lawsuit about Facebook's unapproved use of user images for advertising purposes. The judge, who had previously expressed skepticism about the terms of the settlement, wrote that the plaintiffs had not justified the lack of direct monetary payments to Facebook users, nor had they explained how users will receive an economic benefit from being able to opt out of future endorsements. EPIC and several consumer privacy organizations opposed the settlement, saying that there was little benefit to Facebook users and that the cy pres allocation was not aligned with the interests of the class. In 2009 and 2010 EPIC and a coalition of consumer privacy organizations brought a successful complaint to the Federal Trade Commission that resulted in a significant consent order. In a letter to the court following the recent court order, EPIC explained that the FTC settlement had produced far greater benefits for Facebook users. For more information, see EPIC: In re Facebook.

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