Facebook got into some hot water for its “Sponsored Stories,” which couple users’ names and profile photos with name-brand advertisements. Basically, if you “Like” a company, your name and face may appear in its ad to other Facebook users.
Since doing that without its users’ knowledge is totally not cool, Facebook got sued. In order to settle the case, the company offered to clarify the practice in its service terms, and pay out $20 million. But here’s where it gets tricky …
Members of the class may submit claims until May 2, 2013. The more Facebook users who submit claims, the less each claimant will be paid. So, after legal fees are paid to the plaintiffs’ attorneys, up to around 1.2 million people could receive $10 each. According to CNN, if a greater number of people apply, the money has to be distributed farther, and therefore each claimant gets less dough.
And the real catch — because there always is one — is if the number of people who submit class settlement claims is greater than the amount of money left over, thereby making it “economically infeasible” for Facebook to pay out in cash, all the money will be diverted to charity organizations that promote Internet privacy.
So, if you submit a claim, the result will either be Facebook pays you between $1 and $10, or you help generate a $20 million charitable donation. The choice, however, isn’t yours — it’s Facebook’s. Fancy that.
More information about the settlement can be found by visiting at fraleyfacebooksettlement.com.