Millions of US Facebook users pass on US$650mil privacy jackpot


Some 1.57 million people will probably pocket more than US$300 (RM1,227) each – after about a third of the US$650mil (RM2.65bil) settlement fund is set aside for their attorneys and administrative costs – from a lawsuit in which the social network was accused of collecting biometric images from its photo-tagging feature without consent. — Bloomberg

Facebook Inc will be making payouts to only about a quarter of the six million Illinois residents eligible for the biggest consumer privacy settlement in US history.

Based on a tally filed in court after Monday’s claims deadline, some 1.57 million people will probably pocket more than US$300 (RM1,227) each – after about a third of the US$650mil (RM2.65bil) settlement fund is set aside for their attorneys and administrative costs – from a lawsuit in which the social network was accused of collecting biometric images from its photo-tagging feature without consent.

As class actions go, with nickel-and-dime payouts often not worth the effort of filing a claim, a case that ends up with a 25% buy-in from consumers is a success story. Frequently, fewer than 10% of eligible people file claims.

In Facebook’s case, the judge was initially sceptical if a settlement of less than US$1bil (RM4.09bil) was fair, considering that if users had taken the company to trial they could have sought damages of as much as US$5,000 (RM20,430) for each violation of the Illinois Biometric Privacy Information Act.

To get US District Judge James Donato on board, the company and the lawyers for consumers added an extra US$100mil (RM408.60mil) to what was originally a US$550mil (RM2.24bil) accord, and they promised an extra-aggressive outreach effort, which included pinging Facebook users directly through their accounts to alert them to the cash jackpot. Final approval of the deal is scheduled for early in 2021. – Bloomberg

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