A settlement has been reached in the case of Fraley v. Facebook, in which Facebook was sued for using users’ photos and names in sponsored stories without permission. The settlement, spread among the millions of users affected, will only amount to about $10 per user. It might seem like a small amount, but it’s a huge win for online and social network privacy.
Last year, Mark Zuckerberg and Co. thought they had found a way to personalize sponsored stories even more. If a user’s friend liked a brand, her profile picture and name would then become part of the campaign, appearing next to the brand’s post. This would increase the user’s likelihood of engaging with the brand. Problem? Facebook never actually asked users’ permission to use their profiles in campaigns.
In the first lawsuit settlement between Facebook and the five suing users, Facebook settled for $20 million, which would be distributed to various Internet privacy organizations and movements. The settlement was rejected by Judge Richard Seeborg and the legal teams returned to the drawing board. The next settlement, which has been tentatively approved, gives users a small portion of the earnings.
While users might be excited to receive their $10, the number isn’t finalized. Besides the approval process, after legal fees, the settlement number is closer to $12 million. The actual amount doled out to users depends heavily on how many users actually claim their money, since it’ll be split evenly among those affected. The Fraley v. Facebook website includes instructions for Facebook users to redeem their claim.
In the Q3 2012 earnings call, Zuckerberg revealed that sponsored stories alone made the site $1 million per day, so don’t expect them to disappear anytime soon. The settlement might put a small dent in Facebook’s profits, but it’s but a drop in the bucket for the online juggernaut.
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