$15 Billion Class Action Suit Filed Against Facebook

Facebook PrivacyIf you read any tech news, then you are probably quite used to seeing articles about Facebook’s privacy issues. Heck, I’ve written a number of them myself over the years. Thus it should not really surprise anyone that a group of fed-up users have filed a class action suit against the company on those very grounds.

The Sacramento Bee gives us some pertinent details via PR Newswire:

Facebook users today filed an amended consolidated class action complaint in federal court in San Jose, California in the case In re: Facebook Internet Tracking Litigation, No. 5:12-md-02314-EJD. The class action asserts federal statutory and California State causes of action related to the revelation in September 2011 that Facebook was improperly tracking the internet use of its members even after they logged out of their accounts. The action consolidates 21 related cases filed in more than a dozen states in 2011 and early 2012.

The plaintiffs assert claims under the federal Wiretap Act, which provides statutory damages per user of US$100 per day per violation, up to a maximum per user of US$10,000. Even if Facebook’s alleged actions constitute a single violation of the Wiretap Act per class member, that implies more than US$15 billion in damages across the class. The complaint also asserts claims under the Computer Fraud and Abuse Act, the Stored Communications Act, various California Statutes and California common law.

This is a good thing. Since the law has no real prayer of evolving at the speed of technology, Zuckerberg and company have had very little restraint in building a business based on questionable privacy practices. A suit like this one is a step in the right direction as far as calling them to heel.

The timing is obviously well planned. The fact that the suit has been brought against them while all eyes are on the public offering is a shrewd move guaranteed to maximize public attention to the suit. Stewarts Law, the firm bringing the suit, is asking for $15 billion, only $1 billion less than the Internet giant is expecting to raise in its IPO. The fact that this is the biggest IPO in tech history is amazing, and it also creates the perfect platform for privacy activists across the globe. 

One meme worth noting on the side: No matter what platform I log into, I keep seeing, “Why did Facebook go public? Because they couldn’t figure out the privacy settings either.” That little slice of the zeitgeist speaks volumes about how used to this fight we have become.

One of the lawyers involved, Stewarts Law partner David Straite, was quoted as saying: “This is not just a damages action, but a groundbreaking digital privacy rights case that could have wide and significant legal and business implications.” I don’t think it is exaggeration to say that I think he is 100% correct.

Facebook has constantly been under fire since it first spread past the Harvard campus. While success will always bring unwarranted detractors, in the case of Facebook, there has consistently been hard data showing cause for complaint. (Anyone remember Beacon? What about the furor over its face recognition?)

As a matter of fact, Facebook’s chronic privacy issues look like they will be causing problems for the company overseas as well. BusinessWeek reports that the Germans are none too pleased with the social platform for similar reasons:

A German data protection official has warned Facebook investors that the social networking site’s $38 starting share price is based on practices that breach European privacy rules.

Thilo Weichert, the data protection commissioner for the northern German state of Schleswig-Holstein says shareholders should be aware that if European privacy authorities have their way, ‘Facebook’s business model will implode.’

So, there you go: The biggest IPO in history has helped mobilize privacy advocates around the globe. Straite has stated that his firm is evaluating ways to add non-U.S. residents to the group of plaintiffs.

So, Facebook users, what do you think of all this? Have you been buying shares, exploring becoming part of the class action, or simply pulling out the popcorn and preparing to watch the show?

Image by redtimmy (Tm Wayne), used under its Creative Commons license.

About George Williams

George “Loki” Williams is the community and brand manager for award wining game company Savage Mojo, Ltd. and the owner of SocialGumbo, LLC, an online consultancy specializing in Web content and online communications. Loki has produced content for clients including the Open Society Institute, National Association of Broadcasters, Kobold Press, and Kaiser Permanente. His work has been seen or written about in The New York Times, The BBC, Air America, The Gambit Weekly, and NOLA.com, among others.

  

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