Posted October 26, 2009 1:34 pm by with 1 comment

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Facebook IconAs announced last month, Facebook is finally ending its unpopular advertising program, Beacon, through a court settlement. The class action lawsuit settlement only needed judicial approval to make it final. And last week we they got that preliminary approval. Once the deal is good and done, Facebook will officially end Beacon, and pay $9.5M in damages, according to Read Write Web.

Two-thirds of the fine would go toward setting up a non-profit foundation for therapy for people who had surprises ruined by Beacon “projects and initiatives that promote the cause of online privacy, safety and security.” The remaining $3+ M would go to the 19 plaintiffs, who could expect anywhere from $1000 to $15,000 a piece, according to MediaPost, and their lawyers (who could expect $2.7M or more). Hm. Once again, cui bono?

The suit claimed that Beacon’s opt-out option was “inadequate, misleading and deceptive.” Facebook reformed the program to be opt-in, and apologized. Technically, it still exists today, but once this settlement is finalized, the program will end once and for all—and Facebook will be absolved of liability in any other Beacon-based lawsuits.

Hm. Once again, cui bono? Facebook could get out of the suit against them and Blockbuster, and any others, for a cool $9.5M. Sounds like a good deal. Meanwhile, David Johnson of the Digital Media Lawyer Blog says, “Facebook is already required by law to promote the online privacy, safety and security of its users’ information,” and they get to funnel most of the settlement money back into those efforts, through a non-profit.

What do you think? Should the plaintiffs have held out for a better deal for them or is this what lawyers call “cy pres“—as near as possible to an equitable solution, since they can’t place a dollar value on the plaintiffs’ losses?

  • surprised it took this long for that program to be migrated out