Summary:

A controversial deal that calls on Facebook to pay $15 to some users while giving millions more to lawyers and non-profits could be on ice after a children’s advocacy group and others filed an appeal.

Facebook Newsfeed ads catalog 2013

Facebook users and advocacy groups are calling on a California appeals court to review a controversial settlement that would see the social network pay $20 million to resolve claims that it showed users’ photos in ads without permission.

The multiple appeals were filed on Tuesday by the Children’s Advocacy Center and the Center for Public Interest Law, as well as by individual Facebook users on behalf on themselves and their children who are included in the settlement.

The settlement in question relates to so-called “Sponsored Stories,” in which Facebook shows ads to a user’s friends to indicate that he or she “Liked” a product or company.

Under the deal, Facebook will pay $15 to about 615,000 users and divide the rest of the money between lawyers and 14 non-profit groups. One of the groups, the MacArthur Foundation, has declined the money on the grounds it doesn’t work on consumer privacy issues; Facebook has not commented on how the groups were selected.

Update: In an email statement, a Facebook spokesperson stated:

“We believe these claims are without merit. The court-approved settlement provides substantial benefits to all class members, including minors, through enhanced notice and consent provisions and innovative new tools related to advertising.

The settlement has already been halted once by a federal judge who objected to an initial proposal to give half of the $20 million to lawyers. The judge approved a final version in late August but the appeals mean any payments won’t be forthcoming for months or years.

The settlement has also come under fire by the Electronic Privacy Information Center for allegedly expanding the rights Facebook can exercise over photographs. EPIC and other consumer watchdogs have asked the FTC to investigate the deal and how it affects minors.

Fraley Appeal

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