Facebook Wants Beacon Challenge Dismissed

Facebook wants a challenge to the $9.5 million Beacon settlement dismissed, and submitted a formal request for that with the Ninth Circuit Court of Appeals.

This settlement concerns a now defunct ad program called Beacon, which created controversy for gathering data on friends’ activity off of Facebook and sharing it with users on the social network.

The application originally defaulted to an opt-out setting, meaning that it automatically shared the data unless a user specified otherwise.

People reacted so adversely to this in 2007 that Facebook soon offered a way for people to permanently opt out. But that didn’t placate 19 users who filed a class action lawsuit over Beacon. The social network settled with them least year, but a couple of privacy activists oppose the terms.

MediaPost reported that attorneys for the social network wrote that the trial judge “correctly found the settlement to be fair, reasonable and adequate” in papers filed last week.

Dismissal of a challenge saves money for taxpayers in addition to saving money for Facebook. That makes such requests a popular choice, although not a consistently successful one.

In fact, the same appellate court will begin hearing another settlement challenge next month, one involving a lot more money and notoriety. That case, brought by the Winklevoss twins, may keep Facebook’s attorneys occupied enough to want to minimize the number of other challenges coming their way.

On the other hand, recent negative press coverage of the Winklevosses may make things go more quickly by the time the oral arguments begin January 11, 2011.

That amount of media attention hasn’t surrounded the Beacon case, perhaps because of the smaller amount of money involved. So any further litigation on this issue wouldn’t have had as much of a “preliminary trial” in the press.

The terms of the settlement asked Facebook to create a privacy foundation and also reimburse the 19 plaintiffs that sued, in amounts between $1,000 and $15,000.

The challenger of the settlement, Ginger McCall, an attorney with the Electronic Privacy Information Center, thinks Facebook will have too much influence over the new foundation. (Does she want to run it herself?) She submitted her appeal just two months ago.

Readers, what do you make of Facebook’s request for dismissal of the Beacon challenge filed by McCall? If you were the judge, would you dismiss the case?

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