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Facebook to be sued for $15 billion in class-action privacy suit

By Anne Sewell     May 19, 2012 in Internet
Facebook had better do well on the stock exchange. It may need the money to pay off a class action suit on behalf of users who were tracked on the Internet by Facebook after logging out.
A 15-billion-dollar nationwide class-action lawsuit has been filed against Facebook in California. The allegations? Tracking Facebook users after logging out and also violating U.S. wiretapping laws.
ZDnet.com reports that the suit combines 21 cases filed across the U.S. of alleged privacy violations by Facebook and was filed on Friday in the Federal Court of San Jose. The plaintiffs are claiming that Facebook used cookies to track them across the Internet, after they had logged out of the social media network.
Apparently Facebook violated the U.S. Wiretap Act by tracking users' movement on the Internet through "like" buttons embedded on millions of web pages throughout the web.
15-billion-dollars sounds like a lot. However, violation of the Federal Wiretap Act suggests compensation of US$100 per day per user for every incidence of violation, up to a maximum of US$10,000 per user. The case also falls under the Stored Communications Act, the Computer Fraud and Abuse Act and the common law of California.
Stewarts Law is one of the Plaintiffs leading the class-action suit. One of the partners, David Straite told Bloomberg, “This is not just a damages action, but a groundbreaking digital-privacy rights case that could have wide and significant legal and business implications.”
The suit is for the moment limited to the U.S., but Stewarts Law is apparently seeking ways to expand the case internationally.
There have been many accusations in the past that Facebook uses cookies to track its users even when they are logged out. However, in the past these claims have been turned down on the grounds that cookies are not legally considered to be wiretaps. It is going to be a challenge to prove damages in this suit.
The Data Protection Commissioner (DPC) in Ireland, where Facebook holds its international headquarters, agreed in September to conduct a privacy audit of the social network's activities. The 3-month audit concluded that the company makes “innovative use of cookies to identify unusual or suspicious activity” on an account, which is good news for Facebook.
In late 2011, Facebook entered into a privacy agreement with the U.S. Federal Trade Commission in order to settle a case in which the agency had accused the social media network of "engaging in deceptive privacy policies that cause users to share more information than intended." Under that agreement, the social media network is subject to fines of $16,000 per violation per day.
PCWorld reports that at the moment, Facebook is insisting that "We believe this complaint is without merit and we will fight it vigorously," according to Andrew Noyes, the social media giant's manager of public policy communications.
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