Facebook May Owe You $10 In Sponsored Stories Lawsuit

Millions and millions of U.S. Facebook users received an email last weekend that read LEGAL NOTICE OF SETTLEMENT OF CLASS ACTION – just like that, in all caps. It says that “a federal court authorized this notice,” and that it’s “not a solicitation from a lawyer.”

It also tells you that you may be entitled to up to $10, coming directly from the deep pockets of Facebook.

Although it may sound like a scam (in fact it really, really sounds like a scam), you can rest assured that it is 100% legit. You can proceed with your claim without fear – but you may not want to.

This past weekend, another large group of Facebook users received the Settlement email, which stems from an ongoing class action lawsuit that was first filed in early 2012. Facebook settled the lawsuit, which claimed that the company had infringed upon the privacy rights of users when they used their likenesses, photos, and activity in Sponsored Stories ads without consent, compensation, or the ability to opt-out.

The initial settlement was rejected, however, and Facebook was forced to rework the terms. In December 2012, a judge issued a preliminary ruling approving the new terms: a $20 million settlement that will see the majority handed out to users or to various charities and advocacy groups. It all depends on how many claims are filed.

What Facebook has done, in the simplest of terms, is create a giant fund that can be used to pay class members. If you received an email, it means that you are eligible to sign on as a class member because your activity or likeness was used in a Sponsored Story prior to December 3rd, 2012. The amount that each claimant will receive depends on how many people jump in the pool. If too many people file a claim, and it’s “economically infeasible” to pay out everyone, the fund will be distributed to around a dozen non-profits who all operate to “teach adults and children how to use social media technologies safely,” or to “protect the interest of children.

If you received the settlement notice, you have five options. You can either submit a claim, which makes you eligible for the $10, but prevents you from joining any other action against Facebook in this realm. Or you can exclude yourself, which lets you retain your ability to sue Facebook in matters pertaining to Sponsored Stories. If you do nothing, you give up your right to both the money and future litigation.

As far as the money goes, you have until May 2nd to submit your claim. Or you can do nothing, of course.


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