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Facebook legal notice could get you cash, so don't trash it

If you received the recent legal notice from Facebook, you may be paid up to $10 as part of a settlement over Sponsored Stories dispute.

Facebook recently sent a legal notice to users that may appear daunting at first glance, but before you relegate it to the trash bin you ought to take a look at it -- it could mean cash in your pocket.

The notice is meant to notify some of its U.S. members that their names, profile pictures, photographs, likenesses, and identities were unlawfully used to advertise or sell products and services through Sponsored Stories without obtaining those members' consent.

"Sponsored Stories" is targeted advertising that uses information about your friends to sell stuff to you.

To settle a class action lawsuit (Angel Fraley v. Facebook) resulting from those allegations of unlawful use of its members' content, the social network is proposing to pay $20 million into a fund to be used to pay members who appeared in the sponsored stories.

If you received the legal notice from Facebook, you may be paid up to $10 as part of the settlement.

There's no guarantee you will get the money, however.

As the notice points out: "The amount, if any, paid to each claimant depends upon the number of claims made and other factors detailed in the settlement. No one knows in advance how much each claimant will receive, or whether any money will be paid directly to claimants."

Since as many as 100 million Facebook members may be affected by the settlement, and the fund would be exhausted after paying $10 to 2 million members, there's a good possibility that the alternative distribution scheme outlined in the settlement will be implemented.

That alternative would divvy up the money among a number of non-profit organizations involved in educational outreach that teaches adults and children how to use social media technologies safely, or are involved in research of social media.

According to the long form of the legal notice [PDF], those organizations include the Center for Democracy and Technology, Electronic Frontier Foundation, MacArthur Foundation, Joan Ganz Cooney Center, Berkman Center for Internet and Society (Harvard Law School), Information Law Institute (NYU Law School), Berkeley Center for Law and Technology (Berkeley Law School), Center for Internet and Society (Stanford Law School), High Tech Law Institute, (Santa Clara University School of Law), Campaign for Commercial-Free Childhood, Consumers Federation of America, Consumer Privacy Rights Fund, ConnectSafely.org, and WiredSafety.org.

You can fill out a claim form and see what happens.

The Fraley case began winding its way through the courts in March 2011, when five Facebook members, including two minors, maintained they claimed to represent a class of people injured by the Sponsored Stories.

In June 2012, Facebook and its opponents in the litigation announced a $10 million settlement in the case in which all the money would go to social service organizations and advocacy groups involved in the protection of children in the context of social media.

About a month later, the federal judge presiding over the case -- Judge Lucy Koh, who also presided over Apple's successful intellectual property case against Samsung in the U.S. -- recused herself from the case without an explanation.

Judge Richard Seeborg, who took over the case from Koh, subsequently rejected the $10 million settlement . In denying the proposed settlement, the judge maintained that Facebook did not adequately justify the size of the final deal.

A deal with a new settlement amount was hammered out in October and received preliminary approval from Seeborg in December.


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