Facebook Privacy Settlement 'Worthless' To Users, Critic Argues

A critic of class-action settlements is asking a federal appellate court to scrap Facebook's recent settlement of a privacy lawsuit over allegations that it scanned users' private messages.

The settlement, which requires Facebook to add a new 22-word sentence to its help site, is "worthless" to the company's users, the Center for Class Action Fairness says in papers filed Thursday with the 9th Circuit Court of Appeals.

The deal, approved by U.S. District Court Judge Phyllis Hamilton in the Northern District of California, resolved a 2013 lawsuit brought by Arkansas resident Matthew Campbell and Oregon resident Michael Hurley. They alleged that Facebook violated the federal wiretap law by by intercepting users' messages to each other and scanning them. The company reportedly did so in order to determine whether people were sending their friends links to outside sites.

The allegations emerged in 2012, when security researcher Ashkan Soltani reported that Facebook counts in-message links as "likes." Facebook said at the time that no private information is exposed, but confirmed that the like-counter "reflects the number of times people have clicked those buttons and also the number of times people have shared that page's link on Facebook."

Facebook has since changed that practice. The settlement notes that Facebook revised its prior practice, but the agreement doesn't prohibit the company from changing it again in the future.

The deal requires Facebook to pay up to almost $4 million to the class-action attorneys who brought the case, and $5,000 each to the two Facebook users who served as plaintiffs, but no monetary awards to the company's other users. Instead, users who want to pursue claims for monetary damages may bring new lawsuits.

The settlement also obligates Facebook to add the following sentence to its help site: “We use tools to identify and store links shared in messages, including a count of the number of times links are shared.”

The Center for Class Action Fairness, founded by activist Ted Frank, argues to the 9th Circuit that the deal should be vacated on the grounds that it doesn't benefit users. "The 22-word disclosure regarding Facebook’s collection of message content ... is itself worthless," the organization argues. "That bare-bones addition to one of Facebook’s little-read help pages is duplicative of a disclosure Facebook made in its Data Use Policy well before a settlement was reached, and is unlikely to be seen by -- much less provide a benefit to -- the overwhelming majority of the class."

The group also notes that Facebook's users, as opposed to class counsel, are supposed to be the main beneficiaries of a deal. "The settlement here gives preferential treatment to class counsel, allocating virtually the entire settlement benefit to the lawyers rather than the class," the organization contends.

The Center for Class Action Fairness has challenged other high-profile privacy settlements involving tech companies. Earlier this month, the organization asked the Supreme Court to decide whether Google should have been allowed to settle a privacy battle by donating more than $5 million to nonprofits.

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