In House - The FindLaw Corporate Counsel Blog

Facebook Changes Business Practices to Settle Privacy Lawsuit

To settle a class action lawsuit alleging privacy violations, Facebook has agreed to change its method of sharing information that the company gleans from users' messages.

Facebook agreed to stop using data from links sent in messages to target advertising, and it will not share user data with third parties, or boost "likes" on third-party websites with that information, according to the proposed settlement.

In their complaint, the plaintiffs had alleged that "private" Facebook messages are systematically intercepted by the Company in an effort to learn the contents of the users' communications."

"This practice is not done to facilitate the transmission of users' communications via Facebook, but because it enables Facebook to mine user data and profit from those data by sharing them with third parties -- namely, advertisers, marketers, and other data aggregators," the lawsuit claimed.

More Policy Changes

"The settlement achieves significant business practice changes, and benefits the settlement class now ... without the inherent risks of continued litigation and without requiring Class Members to release any claims they may have for monetary relief," according to a motion for preliminary approval of the settlement filed by the plaintiffs' attorneys.

During the litigation, Facebook updated its data policy to disclose that it collects the "content and other information" that people provide when they "message or communicate with others," and to further explain the ways in which Facebook may use that content.

As part of the settlement, Facebook will also add language to its help center letting users know that it uses "tools to identify and store links shared in messages, including a count of the number of times links are shared."

Remedy and Fees

The proposed settlement covers claims for declaratory, injunctive and non-monetary relief, but class members other than the plaintiffs -- potentially millions of Facebook users in the U.S. -- may seek compensation on their own. It also provides for attorneys fees, which may reach $3.23 million.

U.S. District Judge Phyllis J. Hamilton, of the Northern District of California, is scheduled to rule on the proposal on April 12, 2017.

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