14 DAY TRIAL // Facebook has come up with a new settlement deal in the Sponsored Stories privacy lawsuit, one that takes into account the judge's objection. The judge wanted Facebook to better explain how it came up with the damage awards and the money regular users were supposed to get in the class action suit.
Facebook will still pay the same $20 million, €15.4 million it wanted to before, but the money will be distributed differently.
There were some concerns that the lawyers in the suit and the privacy groups involved were getting most of the money, while the people actually hurt weren't getting much.
It's worse since users weren't getting a drastically improved feature either. The lawsuit was filed over Sponsored Stories, i.e. people's likes showing up in ads.
If you press the like button on Coca Cola's Facebook page, for example, your name might show up next to the ad for your friends to see.
The lawyers argued that Facebook did little to warn users that this would happen. As is usually the case in these things, Facebook settled.
The money was to be divided between the lawyers, which would get half, $10 million, €7.7 million and several charities and organizations which were supposed to act on behalf of the users.
People didn't get anything since it was considered that it would be too hard to divide the money to the 125 million Americans that were involved.
The judge didn't like it though and wanted more details on how the figures were determined. Facebook has now come up with a new deal.
The lawyers still get half of the money, but the rest is to go to users, all 125 million of them. That would amount to 2 cents per user, but those who apply to get the damages award will get a guaranteed $10, €7.7. Anything that's left will go to charities.
The judge can decide that it would be cumbersome for 125 million people to be paid this small amount and give the money to charities instead. It's unclear though whether he will approve this new deal.