• by Wendy Davis  @wendyndavis, August 22, 2011

A Web user has settled his privacy lawsuit against Specific Media stemming from allegations about the company's use of Flash cookies.

As part of the resolution, Specific, which in late June acquired MySpace.com, said it had not used Flash cookies to track users in the past, and would not do so in the future, according to David Stampley, one of the lawyers who brought the case on behalf of Web user Stefen Kaufman. The financial terms were not disclosed.

This lawsuit was one of several recent cases dealing with Flash cookies. Quantcast, Clearspring and Say Media's VideoEgg recently paid a total of $3.4 million to settle similar lawsuits alleging that they circumvented users' privacy controls by using Flash cookies for tracking.

Flash cookies are controversial because some Web companies allegedly use the technology to circumvent users' privacy settings. Flash cookies are stored in a different location in the browser than HTTP cookies, so users who delete their HTTP cookies did not necessarily also delete Flash cookies.

This setup meant that Web companies were able to store tracking information on Flash cookies, and then use those cookies to respawn HTTP cookies. (Adobe recently took steps to prevent this by making it easier for users to delete Flash cookies.)

Flash cookies are not the only way for companies to reconstruct HTTP cookies. ETags -- stored in users' cache files -- also can be used to recreate cookies. A report several weeks ago revealed that the analytics company KISSmetrics was using ETags to respawn deleted HTTP cookies.

The settlement agreement, finalized last Friday, ends the lawsuit against Specific Media, but a slew of new lawsuits regarding Flash cookies and ETags are just getting underway. AOL, Hulu, and  KISSmetrics are among the companies that were sued recently for allegedly using Flash or ETags to recreate deleted cookies.

Before agreeing to settle Kaufman's lawsuit, Specific Media won a round in court in May, when U.S. District Court Judge George Wu in the Central District of California dismissed an earlier version of the lawsuit. At the time, Wu said Web users who were suing had not alleged sufficient economic injury.

But Wu allowed the case to be amended and refiled. Specific Media and Kaufman settled before a judge ruled on whether his new complaint adequately alleged financial injury.