Facebook's lawsuit settlement gets questioned by judge

In June, it was revealed that Facebook had entered into an agreement to settle a lawsuit surrounding its Sponsored Stories feature. Under its terms, Facebook would pay $10 million to a charity to settle claims that Facebook was in violation of a California law. The class action lawsuit claimed the company was publicizing users' "likes" of Sponsored Stories without payment or offering a way to opt out of having their "likes" featured.

Now it looks like that relatively small settlement fee (along with $10 million more to pay for legal fees) could be in jeopardy. Reuters reports that on Thursday, US District Judge Richard Seeborg said in a hearing that amount of money " ... doesn't make any sense to me."

He also wondered why none of the class action lawsuit members received any money in Facebook's settlement. In response, Facebook's attorney Michael Rhodes claimed that they were unable to discover the exact value of each Facebook user's "likes" in publicizing them in Sponsored Stories.

In addition to the settlement fees, Facebook has also agreed to give users more control on how their personal information is used on the service. According to a third party economist, the changes for Facebook members is valued at $103 million.

Judge Seeborg may take several months before revealing his final decision on whether or not to approve the settlement. Regardless, it does seem rather odd that, in terms of cash, Facebook will get not much more than a slap on the wrist if this settlement goes through.

Source: Reuters

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