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facebook lawsuit

Facebook’s trying again to resolve a lingering privacy lawsuit filed by unhappy users.

After a judge threw out the last proposed settlement, Facebook has revised its offer to resolve the so-called “Fraley” suit, filed last year on behalf of individuals who were unhappy over the social network’s use of their names and photos in so-called “sponsored stories” advertisements.

WTF are “sponsored stories”????? Those are ads in which companies pay to inform a Facebook user’s friends when that user has “liked” a particular brand or product.

Facebook has boasted that such recommendations are highly effective as advertisements. But some people weren’t happy to find their names and pictures being used in that fashion. They filed a class action suit in federal court, seeking compensation and more control over future ads.

The new settlement proposal, outlined in court documents filed over the weekend, would set aside a pool of $20 million and let individuals claim damages of $10 each. Any left-over funds would be divided among several non-profit tech organizations.

The proposed settlement covers nearly 125 million people, court documents show.

In addition to those cash payments, under the proposed settlement, Facebook says it will add a more explicit disclaimer to its terms of service, explaining that all users are giving Facebook the right to feature their names, profile pictures and other information in commercial messages. Facebook is also promising to create a new feature that lets users see how their names and interactions — such as their “likes” — have been used in “sponsored stories,” and to control how that information will be used in future ads.

Facebook’s revised agreement also provides new terms on targeting children.

Facebook said it agreed to encourage new users to designate who else on the site is a member of their family. Parents will be able to directly have their children opt-out of the Sponsored Stories feature once their relationship to the child is confirmed.

The new plan will be reviewed by U.S. Judge Richard Seeborg in a hearing at the San Francisco federal court on Oct. 25.

The case is Fraley v. Facebook Inc., U.S. District Court for the Northern District of California, No. 11-1726.

via BMS

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