On May 1, 2013, on behalf of a guardian ad litem for two minor class members, the Children's Advocacy Institute filed an objection to the Proposed Settlement in Fraley v. Facebook, U.S. District Court Case No. 11-CV-01726. Among other things, the Fraley class action challenges Facebook's taking and utilization of a subscriber's image, name and personal preference information, together with text and pictures, in such a way as to transform the character of the subscriber's information into a commercial endorsement known as a Sponsored Story, for which Facebook receives payment from advertisers. CAI became interested in this case because in addition to using adult subscribers' images, names and preference information for its own commercial use, Facebook routinely so takes and uses the images, names and preferences of its minor subscribers for its own commercial use--without first obtaining affirmative parental consent authorizing them to do so.
The proposed settlement is deficient in several significant respects and creates no benefit to the subclass consisting of minor Facebook subscribers. Instead of requiring a parental opt-in consent format, requiring affirmative parental consent on a case-by-case basis prior to each use of a child subscriber's image and information, the proposed settlement creates an illusory opt-out preference that will likely go unnoticed by most users and which Facebook has agreed to put in place for just two years.
The proposed settlement also requires Facebook -- which has over 165 million subscribers and made a profit of $1 billion last year -- to put just $20 million into a fund. What comes out of the fund first would be attorneys' fees and costs -- and a request of over $7.7 million has already been filed by the Fraley plaintiffs' attorneys. What comes out the fund next would be service awards of up to $12,500 paid to each of the Representative Plaintiffs, and then any costs incurred by the Settlement Administrator and Escrow Agent. The remaining sum -- referred to as the Net Settlement Fund -- would be divided by the number of class members who make valid and timely claims, but in no event will any class member receive more than $10. And if the number of claims made renders it economically infeasible to pay any money to the class members, then no money would go to any of the class members whatsoever, and the Net Settlement Fund would be distributed to selected nonprofit organizations instead.
To view the Objection, please click here.
For information on a separate Objection filed by Public Citizen on behalf of other class members, please click here.