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Facebook Might Pay Users $10 After Lawsuit Settlement

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By Myles Collier, Christian Post Contributor
January 29, 2013|10:36 am

Some Facebook users could soon be paid by the social media giant after it settled a class action lawsuit regarding a feature that used stories and pictures without users consent in ads.

The payout stems from a lawsuit that was filed back in April 2011 by five Facebook users who were upset over the company's "Sponsored Stories" advertising campaign.

The new measure used a users' name and profile pictures after a user clicked the "Like" button on any other company's Facebook page. This allowed for other friends of that user to see pop-up ads endorsing said company with an accompanying picture.

There was no way to opt out of the action, which prompted the lawsuit by those disgruntled Facebook users.

Lawyers for Facebook had previously offered to settle by offering to make changes to its terms of service and also agreeing to pay $20 million that would be directed into a settlement fund.

It looked as if a settlement was going to be reached, but U.S. District Judge Richard Seeborg denied the plan. He felt the money, which would have gone to various internet privacy advocacy groups, should have gone to some of Facebook's users, CNN reported.

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But with the potential class size approaching 100 million people, providing a cash payout would not be possible.

"The issue this presents appears to be a novel one," Seeborg wrote in his ruling in August. "Are some class actions simply too big to settle?"

After another round of negotiations, a different settlement was reached and provided for claimants to receive up to $10 dollars from the settlement fund. However, the structure of the payout was such that the more people made claims the less money went to each of the individuals.

Facebook users who received a settlement notice have until May 2, 2013, to submit a claim. A final hearing is scheduled to occur in June.

 

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