• by Wendy Davis  @wendyndavis, February 18, 2016

The 9th Circuit Court of Appeals won't reconsider its recent decision to uphold Facebook's $20 million "sponsored stories" settlement.

In an order issued this week, the court rejected the University of San Diego's Children's Advocacy Institute's request for a new hearing "en banc" -- meaning that 11 of the court's 23 judges would decide the case.

The watchdog argued that the settlement wrongly enables Facebook to violate laws in seven states, including California, that prohibit companies from using minors' names and photos in ads without their parents' consent.

The settlement, approved in 2013 by U.S. District Court Judge Richard Seeborg, resolved a class-action lawsuit alleging that Facebook's sponsored stories violates a California law about endorsements. That law says companies need adults' permission before using their names or images in ads.

The deal requires Facebook to pay $15 each to around 600,000 users whose name and images were featured in “sponsored stories” ads that were shown to their friends. Facebook also agreed to revise its terms of service to require that users give permission for their names and photos to be shown in ads. Users under 18 must represent that at least one parent agrees. (The company discontinued the “sponsored stories” program in 2014, but still allows people's names and photos to be paired with ads.)

A three-judge panel of the 9th Circuit rejected that argument last month, ruling that it's unclear whether Facebook's ad program violated California's privacy law. The judges added that the settlement offers "more protection for minors from Facebook's advertising practices than existed before."