Facebook May Not Get Away with Only $10 Million in Privacy Lawsuit

The judge is skeptical of a settlement that favors lawyers and non-profits but not privacy

By on August 4th, 2012 13:21 GMT

Oftentimes, lawyers seem to have it the easiest. No matter what happens, they get paid, big money too. In patent lawsuits, companies spend millions on lawyers, no matter if they're defending or attacking. Class-action lawsuits are even worse. Often, lawyers get millions and the people for which, allegedly, the lawsuit has been filed get a couple of dollars, if they get anything at all.

The system is bent against companies and against the people as well, the two sides that should actually be involved.

Instead, lawyers make money, all sorts of "privacy" groups and non-profits make money as well, in donations, while companies end up paying off whatever they can to convince the lawyers to drop the lawsuit.

This though, often, doesn't mean companies mend their ways or change whatever it was they got sued for in the first place.

That's pretty much what's happening in a Facebook lawsuit over sponsored stories, ads which rely on user actions, i.e. if you like a page for a brand you like, your friends may start seeing ads for that brand which specify that you "liked" it, implying an endorsement. Which, in a way, you gave when you first clicked the Like button.

Facebook got sued over it, the lawsuit was turned into a class-action one and now the two sides have reached to an agreement. Facebook will pay the lawyers $10 million, €8.16 million and will give another $10 million in donations.

This, and Facebook says, damages of up to $100 million over potential lost revenue, that is, money it's not going to make if it enables people to opt out of these ads.

The "best" part is that Facebook doesn't have to allow people to opt-out in the settlement. In fact, only minors will be able to remove themselves from these ads completely, everyone else will only be able to "limit" in some ways these ads. Oh, and this applies to US users only, everyone else will be treated as before and won't have the ability to opt-out.

It's unsurprising then that all of this didn't sit well with the judge that has to approve the settlement. He had quite a few questions for the lawyers and said he is going to have to take some time before reaching to a conclusion.

He specifically wanted to know how the two sides reached the $10 million figure. This, even though Facebook estimated its damages at over $100 million.

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