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Facebook hit by European legal threat from students over privacy policies

// News // Law
  • Austrian student group claims Facebook has not done enough to protect members
  • Plans to sue the web giant in Ireland, where it has its international headquarters, and raise funds online

PUBLISHED: 07:10 EST, 4 December 2012 | UPDATED: 08:01 EST, 4 December 2012

A Europe wide student group plans to launch legal action claiming Facebook has not done enough to protect the privacy of its hundreds of millions of members.

Privacy campaign group europe-v-facebook, which has been lobbying for better data protection by Facebook for over a year, said it planned to take legal action in Ireland, where Facebook has its international headquarters.

The move is one of a number of campaigns against the giants of the internet, which are under pressure from investors to generate more revenue from their huge user bases but which also face criticism for storing and sharing personal information.

CEO Mark Zuckerberg's firm is facing legal action in Ireland over its privacy policies

CEO Mark Zuckerberg's firm is facing legal action in Ireland over its privacy policies

Internet search engine Google, for example, has been told by the European Union to make changes to its new privacy policy, which pools data collected on individual users across its services including YouTube, gmail and social network Google+, and from which users cannot opt out.

Europe-v-facebook has won some concessions from Facebook, notably pushing it to switch off its facial recognition feature in Europe.

But the group said on Tuesday the changes did not go far enough and it was disappointed with the response of the Irish Data Protection Commissioner, which had carried out an audit after the campaign group filed numerous complaints.

'The Irish obviously have no great political interest in going up against these companies because they're so dependent on the jobs they create,' europe-v-facebook founder Max Schrems told Reuters.

Gary Davies, Ireland's deputy data protection commissioner, denied Facebook's investment in Ireland had influenced regulation of the company.

'We have handled this in a highly professional and focused way and we have brought about huge changes in the way Facebook handles personal data,' he told Reuters.

'We are committed to providing a service that enables millions of European citizens to connect and share with their friends here and around the world,' Said Facebook.

'The way Facebook Ireland handles European personal data has been subject to thorough review by the Irish Data Protection Commissioner over the past year.

'The two detailed reports that the DPC has produced by the DPC demonstrate that Facebook Ireland complies with European data protection principles and Irish law. 

'Nonetheless we have some vocal critics who will never be happy whatever we do and whatever the DPC concludes.'

Schrems, who has filed 22 complaints with the Irish regulator, said more than 40,000 Facebook users who had requested a copy of the data Facebook was holding on them had not received anything several months after making a request.

The law student also questioned why Facebook had only switched off facial recognition for users in the European Union, even though Ireland is the headquarters for all of Facebook's users outside the United States and Canada.

The move is the latest in a series of concerns over Facebook's privacy policies

The move is the latest in a series of concerns over Facebook's privacy policies

Facebook is under pressure to reverse a trend of slowing revenue growth by selling more valuable advertising, which requires better profiling of its users.

Investors are losing patience with the social network, whose shares have dropped 40 percent in value since the company's record-breaking $104 billion initial public offering in May.

Last month, Facebook proposed to combine its user data with that of its recently acquired photo-sharing service Instagram, loosen restrictions on emails between its members and share data with other businesses and affiliates that it owns.

Ireland also hosts the European headquarters of other high-tech firms including Microsoft and Google thanks to generous tax breaks.

Europe-v-facebook said it believed its Irish lawsuit had the potential to become a test case for data protection law and had a good chance of landing up in the European Court of Justice.

Schrems said the case could cost the group around 100,000 euros ($130,000), which it hoped to raise via crowd-funding - money provided by a collection of individuals - on the Internet.

FACEBOOK SET TO SETTLE OVER SPONSORED STORIES

A U.S. judge has given his preliminary approval to a second attempt by Facebook to settle a class action lawsuit which charges the social networking company with violating privacy rights.

U.S. District Judge Richard Seeborg in California rejected a settlement in August over Facebook's 'Sponsored Stories' advertising feature, questioning why it did not award money to Facebook members for using their personal information.

But in a ruling handed down Monday, Seeborg said a revised settlement 'falls within the range of possible approval as fair, reasonable and adequate.'

In a revised proposal, Facebook and plaintiff lawyers said users now could claim a cash payment of up to $10 each to be paid from a $20 million total settlement fund.

Any money remaining would then go to charity.

The company also said it would engineer a new tool to enable users to view content that might have been displayed in Sponsored Stories and opt out if they desire, a court document said.

If it receives final approval, the proposed settlement would resolve a 2011 lawsuit originally filed by five Facebook Inc members.

The lawsuit alleged the Sponsored Stories feature violated California law by publicizing users' 'likes' of certain advertisers without paying them or giving them a way to opt out.

The case involved over 100 million potential class members.

A spokesman for Facebook said the company was 'pleased that the court has granted preliminary approval of the proposed settlement.'

Lawyers for the plaintiffs weren't immediately available for comment Monday evening.

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