Facebook May Face the Music on Privacy in California Class Action

By Peter Bernstein January 06, 2014

There is an old question that seems very apropos at this moment.  It goes something along the lines of, “What happens when an irresistible force meets and immovable object?”  Ultimately, something has got to give.

The reason this is timely is because the irresistible force of big data and sophisticated analytics, may be meeting its match in how far users are willing to let commercial entities get away with using what was thought to be personal information for the entities’ profits.

What I am referring to, in case you missed it last week, was the filing in the Northern District Court of California by Matthew Campbell and Michael Hurley of a class action lawsuit against social media giant Facebook. The suit accuses Facebook of scanning private messages with URLs in them "for purposes including but not limited to data mining and user profiling."  It asserts that this practice is a violation of the Electronic Communications Privacy Act. It has been filed as a class action because obviously there are possibly millions of aggrieved parties.   

This could be big. The plaintiffs are asking for more than $100 per day of violation, or $10,000 per class member, as well as statutory damages of $5,000 per class member or three times the amount of actual damages – whichever is greater.

We are at the start of the process, which will involve certification of the class for the suit to proceed. And, not surprisingly Facebook promptly issued a statement saying, "We believe the allegations are without merit and we will defend ourselves vigorously.” 

It should be noted before writing this off, that this is not the first time Facebook has been under investigation for the murkiness surrounding its privacy settings. In fact, in 2012 it settled (in what many civil libertarians at the time thought was for way too little) with the U.S. Federal Trade Commission (FTC) over a complaint that it had deceived  users in saying it was protecting private information when in fact it was not. 

Even more pertinent is that this could be a class that the court recognizes as having standing.  Indeed, there is precedent here.  A California Judge in September, 2013, gave disgruntled Google users recognition as a class by rejecting Google’s request to dismiss a case that involves alleged violations of federal and state wiretap laws associated with Google’s practice of scanning of Gmail and using the personal information for profit.

Prove it ain’t so!

The 35 page filing is an interesting read, even for those without a legal education.  Here briefly is some of the language that gets to the heart of the matter:

 "Representing to users that the content of Facebook messages is 'private' creates an especially profitable opportunity for Facebook, because users who believe they are communicating on a service free from surveillance are likely to reveal facts about themselves that they would not reveal had they known the content was being monitored.. Thus, Facebook has positioned itself to acquire pieces of the users' profiles that are likely unavailable to other data aggregators.

Facebook does not make it clear that it "scans, mines, and manipulates the content of users' private messages."  

As has been noted in the coverage of the suit, it also cites a report from Swiss security firm High-Tech Bridge that suggests that Facebook scans the links shared in private messages, and highlights other instance that have been reported of Facebook's third-party plug-ins for counting "likes" shared through private messages.

It should also be noted that this is not a full-scale attack on all of Facebook’s privacy terms and conditions and whether they have fraudulently represented them. It has been seemly carefully crafted to be on behalf of all U.S. users who have sent or received private messages that included a URL in the message. Plaintiffs want Facebook to cease and desist this practice along with the payment of damages and fines.

For those reading the tea leaves as to what this portends, think of it as the opening salvo is the tussle over the use of personal information that has been inflamed by the Snowden revelations.  I did not include this in my 2014 predictions, but I do believe that the year ahead will see numerous push-backs by consumers (groups and those using the class-action route) to use the courts as a means to restore some semblance of a legal regime where personal privacy matters!

What has previously been a rather benign attitude on the part of we who use free services like Facebook, Google and Twitter toward how our personal information, including our online behavior and locations, are used appears to have reached the proverbial line in the sand. It will be fascinating to say the least to see if the irresistible force has finally met an immovable object in the form of user resistance.  

It will also be interesting, as I have advocated many times, to see if a start-up emerges that says in exchange for personal information supplied to advertisers they will cut me a small piece of the action.  I have been checking Kickstarter, but so far nobody has popped up. 

There is a saying in the U.S. that all trends start in California.  You may wish to write this one down to see if it becomes pervasive not just in the U.S., but is picked up in other parts of the world.  Class could now be in session.

Edited by Cassandra Tucker
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