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Facebook’s “Sponsored Stories”

On March 29, 2012, Debbie Douez, a British Columbian entrepreneur, launched a class action lawsuit against the high profile social media website, Facebook, over what she believes is a “high-handed” and “reckless” breach of privacy laws.

Background

Douez, a videographer and owner of Video4Web Productions, filed a lawsuit in British Columbia’s Supreme Court on behalf of all BC residents who are Facebook members and whose name or portrait has been used by the company in a “sponsored story” without their knowledge or consent.

What happened was that Douez clicked the “like” button on a group called Cool Entrepreneurs, and found her photo and name displayed in an ad, which was subsequently shown to her Facebook Friends. Her photo appeared with the caption “Debbie Douez likes Cool Entrepreneurs.”

Douez’s lawyer, Luciana Brasil, commented, “If you’re going to be using somebody’s name or somebody’s portrait for advertising purposes, you need to obtain their consent. The position that Ms. Douez takes in this case is that her consent was not sought or obtained.” According to Brasil, the fine print in Facebook’s privacy section was inadequate and the company’s advertising practice as it currently stands breaches part of Canada’s Privacy Act. She also added that similar class action suits would be filed in Saskatchewan and Manitoba.

According to the notice of claim,

“Facebook’s use of the plaintiff and class members’ names or portraits without consent was high-handed, outrageous, wanton, reckless, callous, disgraceful, willful and entirely without care for the plaintiffs and class members’ statutory right to control the use of their own names or portraits, and as such renders Facebook liable to pay punitive damages.”

“Sponsored Stories”

In January 2011, Facebook introduced “sponsored stories” as a form of advertising which uses a Facebook member’s name or portrait to endorse goods or services of a third-party advertiser to a member’s friends without their consent. Sponsored stories are triggered when a user clicks on the “like” button on Facebook in connection with a group or company and its goods or services.

“Checking in” on Facebook to a physical location linked to an advertiser or using an app connected with a sponsor also generates a “sponsored story,” which is featured in a sidebar on the right-hand side of users’ news feeds. In this way, Facebook authors and creates a unique and new ad through the rearrangement of text and images which then features the unwitting member as an endorser, marketer or advertiser of a third party good or service.

In addition to seeking compensation for damages, Douez also seeks an injunction preventing Facebook from using users’ names and portraits in advertising without “written consent,” and a declaration that its use of sponsored stories breached British Columbia’s privacy laws which prohibit unauthorized use of an individual’s name or portrait.

Not long after Douez’s lawsuit was filed, Facebook responded vehemently, saying that “This case has no merit and we will defend ourselves against it vigorously.” The website continued its practice of “sponsored stories,” which essentially equated a Facebook “like” with consent to use a person’s name and photo in ads on their friends’ pages. Companies and organizations can pay Facebook to have these ads show up repeatedly on friends’ pages.

Worse, Facebook’s privacy settings do not offer an opt-out provision, thus denying protection to individuals who may not want their likes to be used as brand or product endorsements.

Rights Under BC’s Privacy Legislation

The class action suit is based on British Columbia’s Privacy Act and alleges that it breaches section three of the Act, which covers unauthorized use of people’s names or portraits. The BC privacy commissioner’s office has also pointed out that Facebook’s use of its users’ information is also covered by BC’s Personal Information Protection Act (PIPA), which comes under the provincial commissioner’s jurisdiction, and Canada’s Personal Information Protection and Electronic Documents Act (PIPEDA), which falls under the federal privacy commissioner’s jurisdiction.

According to Caitlin Lemiski, policy analyst at the BC privacy commissioner’s office, “We have not initiated an investigation but we are aware of the issue and we will be keeping an eye on it as the situation develops. We do have the power to initiate our own investigations, regardless of whether or not we receive a complaint.”

Summary

On March 29, 2012, Debbie Douez field a class action lawsuit against social networking giant, Facebook, alleging that its “sponsored stories” advertising practice breaches British Columbian privacy law. The problem was that a Facebook “like” was being equated with consent to use a person’s name and photo in ads on their friends’ pages. Companies and organizations can pay Facebook to have these ads show up repeatedly on friends’ pages. According to the BC privacy commissioner’s office, the practice is covered under BC’s Privacy Act, BC’s Personal Information Protection Act (PIPA) and the federal Personal Information Protection and Electronic Documents Act (PIPEDA).

CIPP Exam Preparation

In preparation for the Certified Information Privacy Professional/Canada (CIPP/C) exam, and the Certified Information Privacy Professional/Information Technology (CIPP/IT) exam, a privacy professional should be comfortable with topics related to this post, including:

  • Enforcement – federal and provincial privacy commissioners (CIPP/C; I.A.c.i.1.)
  • Personal Information Protection and Electronic Documents Act of Canada (CIPP/C; II.A.a.)
  • Personal Information Protection Act of British Columbia (CIPP/C; II.A.b.)
  • Managing consent (CIPP/C; II.B.d.)
  • Social networking services (CIPP/IT; III.B.k.i.)
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