Facebook Settles In Sponsored Stories Lawsuit

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Facebook has settled a lawsuit over their Sponsored Stories feature out of court today. The terms of the settlement have not been disclosed. A document filed yesterday (PDF) notified the court that the parties in the case had reached a settlement agreement which would be formalized in a second document to be filed today.

According to Reuters, that document has been filed today and the settlement has officially been reached. The terms of the settlement are not clear at present, however, as the court documents do not disclose them.

The class action suit was filed last year in U.S. District Court in California. The plaintiffs alleged that Facebook was publishing their activity without their consent through the use of its Sponsored Stories feature. Sponsored Stories is Facebook's attempt to blend its advertising with basic social networking features. In a nutshell, companies with Facebook pages pay Facebook extra to ensure that when you like that company's brand page, Facebook makes a point of letting all your friends know about it by publishing it to their newsfeeds with the heading "Sponsored Story." Case in point:

Sponsored Stories

The big problem with all this is that Facebook doesn't give you the chance to opt out. If a company has paid Facebook to use you to promote their brand, then Facebook is going to use you to promote their brand. As you might imagine, some people had a problem with this, and numerous lawsuits were filed, including this one and another in British Columbia.

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