A federal judge has rejected Facebook’s settlement offer in a class-action privacy lawsuit over the use of users’ names and faces in “Sponsored Stories” advertisements.
With Sponsored Stories, which rolled out in January of 2011, your “likes” on a brand’s page can result in your name and profile picture being shown as endorsements in that brand’s advertisements on the site. Users were not given an option to opt-out of the feature.
The lawsuit, filed last year, alleged that the practice is a violation of Facebook users’ privacy.
Under Facebook’s proposed deal to settle the lawsuit, it would have given users more control over their “likes,” including the opportunity for users under the age of 18 to opt-out of Sponsored Stories completely. The company would have also paid $10 million to the plaintiff’s legal team and another $10 million to pro-privacy organizations, such as the Electronic Frontier Foundation.
U.S. District Judge Richard Seeborg, who made his uneasiness about the deal known earlier this month, has now firmly rejected it on the basis that the monetary amounts seemed to have been “merely plucked from thin air,” according to Wired.
Seeborg argued that the deal didn’t do enough to address the damages of the 100 million Facebook users who have already appeared in Sponsored Stories. He wrote in his decision that under California law, each party to the lawsuit could be awarded up to $750.
A Facebook attorney has previously argued that the proposed settlement has value for the company’s users.
Facebook earns $1 million in revenue every day from Sponsored Stories.
How do you feel about Facebook’s Sponsored Stories? (Mashable.com)
