TEMPORARY WALL STREET DARLING and social network Facebook has settled a lawsuit that alleged it used its members’ ‘Likes’ for marketing purposes without letting them opt out.
The firm was facing a lawsuit over its use of individuals’ ‘Likes’ in its sponsored stories but has decided to settle out of court without going into much detail.
If it had gone ahead and gone the wrong way for Facebook, the case could have made the firm pay billions of dollars to US members, according to Reuters.
Sponsored Stories is a Facebook tool that shows users what their friends buy and like. Facebook has provided a video that tells us that a firm like Starbucks could gain more traffic on its pages by showing that members’ friends like its products.
This we guess is more or less what Facebook is based on, but apparently for five people it was a bridge too far
Judge Lucy Koh, who presided over the case and the settlement, ruled last December that the plaintiffs had a case under California privacy laws.
“[The] plaintiffs have articulated a coherent theory of how they were economically injured by the misappropriation of their names, photographs and likeness,” she wrote in her ruling then.
This week she returned to that ruling, writing, “California has long recognised a right to protect one’s name and likeness against appropriation by others for their advantage,” in her notes on the case.
We asked Facebook to comment but it declined. It is possible that everyone at the firm is watching its performance on the Nasdaq stock exchange.
If they are, then we imagine that their eyes are following a graph that is moving downwards.
On Monday Nasdaq admitted that it had made changes to its system following some forced changes, delays and “unintended consequences”, and since then the company’s shares have lost about 20 per cent of their initial launch value.