Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Sun July 15 2012 17:26:13

Facebook Donation Provision in Privacy Case Muddies the Waters

By: Ina Steiner

Sponsored Link

People became outraged when they learned that Facebook was using their likeness in advertising to other Facebook users. Some users filed a lawsuit against Facebook in the spring of 2011 for its practice of allegedly "appropriating the names, photographs, likenesses and identities" to advertise services for commercial purpose without their consent or the consent of their legal guardians when a minor was involved, for unfair and deceptive business practices.

The Proposed Settlement
The parties came to a settlement, and the Judge will hear the settlement motion to approve and motion to intervene on August 2, 2012.

Under the settlement, Facebook can still show its users an ad that displays you "liking" a product or brand with your name and image, and Facebook receives ad revenue from the brand for the advertising (it's called "Sponsored Stories"). The settlement proposes that Facebook do a better job of disclosing the practice on its website for 2 years. Here's a link to the settlement on Justia.com in PDF format.

"The injunctive relief will clarify the ways in which Users' actions may lead to their names and likenesses being included in Sponsored Stories ads, and they will have the tools to limit further appearances in Sponsored Stories ads."

However, Mashable wrote, "Facebook will continue to use member check-ins and likes as paid advertisements for brand pages. Facebook, however, will have to amend its current policies and user terms stating when a member signs up for the platform that gives the company the right to use specific content for sponsored-story ads. That means if you've ever "liked" Starbucks, the social network could use your likeness to sell a product to Starbucks friends."

Can Facebook Users Opt out of "Sponsored Stories" Ads?
To better understand the seeming contradiction - can users opt out of Facebook using their names and photos in Sponsored Stories, or not? - read EPIC's filing opposing the settlement terms. EPIC writes:

"Even those who read the new provision will remain uninformed. The provision does not explain which specific actions cause an individual's likeness to appear in a Sponsored Story. The class member who wonders whether Sponsored Stories are the result of likes, check-ins, posts, application uses, or all of the above, will not find the answer in the SSR. Given that the current SSR already gives Facebook the right to associate a user's image or profile with commercial content, it is not clear that the new provision provides much added benefit. Ultimately, notice and choice has been considered a failed model by both privacy scholars and the Federal Trade Commission. Yet it is precisely this failed model upon which the Proposed Settlement relies.

"Additionally, the Proposed Settlement does not clearly explain the new "mechanism" that will allow users to remove themselves from Sponsored Stories. The agreement states only that the mechanism will be "easily accessible" and will enable users "to control which of [their] interactions and other content are eligible to appear in additional Sponsored Stories." However, if the mechanism is anything like Facebook's existing privacy settings, consumers are likely to find it confusing and unwieldy. Examinations of Facebook's privacy settings have found that they regularly fail to allow consumers to achieve their privacy preferences."

Donation Provision
The settlement also provides for non-profit organizations to split $10 million from Facebook. Mashable said over a dozen consumer rights groups, including Consumer Federation of America, Rose Foundation, Center for Democracy & Technology and the Stanford Law School Center for Internet and Society, will split $10 million from Facebook. "Many groups will receive $500,000 or $1 million each," it wrote.

This means the organizations will take money from Facebook and will then be expected to continue to act in a watchdog role over Facebook to ensure it respects users' privacy.

The Wall Street Journal raised similar questions about a 2010 settlement over a 2008 lawsuit against Facebook for sharing information about consumers' online activities, including product purchases made by Facebook users.

"While denying wrongdoing, Facebook last year offered $9.5 million to settle the case. Under the proposed settlement, the plaintiffs' lawyers stand to recover as much as 30% of that amount, with the remainder going not to Facebook users, but to a foundation focused on promoting privacy rights" - a foundation that was to be established in part by Facebook, which would then have a role in drawing up the foundation's bylaws and have a say in choosing one of its board members.

The current proposed settlement would result in watchdog groups using a corporation's money to educate users about the corporation's practices for which it has been sued for privacy violations,...

Either the corporation's practice was right or wrong, and the court should either prohibit the corporation from continuing the practice, or not. Including non-profit donations in a settlement just muddies the waters.




Comments (5) | Leave Comment | Permalink

Readers Comments

Perminate Link for Facebook Donation Provision in Privacy Case Muddies the Waters   Facebook Donation Provision in Privacy Case Muddies the Waters

by: mylifeisgood This user has validated their user name.

Sun Jul 15 17:59:26 2012

So facebook uses the members pictures.. members sue.... Facebook will pay 10 million of which the lawyers will get 30%....and the rest will be donated...

Sound like the lawyers found another get rich quick scheme...Who needs Ebay......

Perminate Link for Facebook Donation Provision in Privacy Case Muddies the Waters   Facebook Donation Provision in Privacy Case Muddies the Waters

This user has validated their user name. by: Doc

Sun Jul 15 19:52:21 2012

I don't use fb a lot but just recently discovered if I upload a photo or post a status update it defaults to a public view. I can later edit a photo from my pc and change it's permissions, but not for a status or check in via Android app.

Status and other wall posts will default to public view unless set to friends or friends of friends before submitting. If your concerned about posts and photos being shared with the public, click the privacy tab and select custom. Then choose your sharing options.

Personally I feel the Faceboook brand is damaged merchandise.  It's also a fad like MySpace that's about ran it's course. If the teens start calling it uncool it's done!

Perminate Link for Facebook Donation Provision in Privacy Case Muddies the Waters   Facebook Donation Provision in Privacy Case Muddies the Waters

This user has validated their user name. by: Doc

Sun Jul 15 20:10:41 2012

Does anyone know how to edit an existing Facebook photo album privacy settings?  It's a PITA to edit each individual photo that defaulted to public.

Perminate Link for Facebook Donation Provision in Privacy Case Muddies the Waters   Facebook Donation Provision in Privacy Case Muddies the Waters

This user has validated their user name. by: Tula

Mon Jul 16 09:28:53 2012

Makes me glad I don't spend a lot of time on Facebook. It's been getting steadily more annoying. I've noticed recently that when any of my FB friends "like" something, I start getting spammed with all the posts from that particular page. They don't have a way to ignore just "likes" from others - just comments and likes together. I'm interested in my friends' comments, but I don't really care if they like "Jersey Shore" and I really don't want spams from that page clogging up my feed.

Perminate Link for Facebook Donation Provision in Privacy Case Muddies the Waters   Facebook Donation Provision in Privacy Case Muddies the Waters

This user has validated their user name. by: TheCheapSkirt

Tue Jul 17 00:46:20 2012

If you click on the X next to sponsored posts you can report them as spam. The page then sees this as a negative action on their ad campaign in their stats.

I think it is important to give them feedback and "push back" in this manner if you don't like it. I would presume that response would end up in Facebooks ad algorithm as well. At least I'm hoping... every day I do it with the offensive political sponsored posts and maybe someday they will stop serving them in my feed ;-)

As far as the ads on the right side of the page and not in the feed, AdBlock works well there. Between hiding the ticker and using AdBlock, my Facebook page is much "cleaner" and nicer to look at.  



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