July 12, 2012

Federal Judge Recused From Facebook Privacy Case

redOrbit Staff & Wire Reports - Your Universe Online

A federal judge in San Jose, California, recused herself on Wednesday from overseeing a proposed settlement of a privacy lawsuit against Facebook over the company´s "Sponsored Stories" feature.

U.S. District Judge Lucy Koh did not provide a reason for her recusal, but referred the case for reassignment to a different judge and canceled a hearing scheduled for Thursday, at which Facebook was expected to seek final approval of a settlement.

The case involves five Facebook members that had filed a lawsuit seeking class-action status against the company. The members claimed that Facebook´s "Sponsored Stories" feature violated California law by publicizing users' "likes" of certain advertisers without compensating members or allowing them to opt out.

The case involves more than 100 million potential class members.

As part of a proposed settlement, Facebook agreed to allow users greater control over how their personal data is used. This includes letting the user more easily see when they are being shown as endorsers of products and games for which they “liked,” and limiting the display of their content and interactions alongside “sponsored stories.”

One economist hired by the plaintiffs estimated the value to Facebook members from the changes to be $103 million, although the amount Facebook would actually pay to settle the case — if approved by a judge -- is just over $20 million, according to court documents filed last month.

In her order on Wednesday, Judge Koh cancelled all pending dates for motions in the case, and asked that it be reassigned to another judge.

Koh had been overseeing the case since it first reached the federal court last year.

Last December, she issued an order rejecting Facebook's attempts to dismiss the suit, saying the plaintiffs had demonstrated economic injury could occur through the social network´s use of their names, pictures and likenesses.

The case is Angel Fraley et al., v. Facebook Inc., 11-cv-01726, U.S. District Court, Northern District of California (San Jose).