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Judge: Google class action 'usual suspects' cash-fling 'smells'

Proposed payout gives class members nothing – objectors

+Comment A Californian judge has rejected a proposed settlement to a class action privacy suit brought against Google.

The deal would have seen the search giant funnel millions to cherry-picked law schools and Google-friendly pro privacy groups.

The lawyers for Google and the lawyers for the plaintiffs agreed to settle the class action privacy suit* after four days of "mediation" and "arm’s-length negotiations" and apparently decided that the firm should pay out $8.5m to lawyers and various Google-friendly groups.

Yet the proposal leaves the individuals behind the class action without a penny, while rewarding digital activist groups, academics and lawyers. Under the proposed settlement's terms, the plaintiffs’ lawyers alone would pocket $2m.

In 2010 a group of consumers alleged that Google “leaked” personal information about search users to third party marketeers. Their class action lawsuit alleges that Google violated its own privacy policy by including search terms in the referrer header. That information is transmitted to sites listed in Google search results whenever a user clicks a link.

Certain types of searches, therefore – such as the user's own name – can be argued to comprise personal data, according to the plaintiffs. The alleged breach comes about when that “personal data” is transmitted to the website receiving the user's click from the search results.

The consumers proposed that Google-friendly cyberlaw departments who’ve benefited previously, like Harvard’s New Age crank-tank the Berkman Center, should receive the benefit of their proposed settlement.

It also added non-tech groups to the list – the American Association of Retired Persons – perhaps in the hope this “diversity” would impress the judge.

US District Judge Edward Davlia didn’t exactly sound thrilled, Bloomberg reports:

“The elephant in the room is that many of them are law schools that you attended,” Davila said, adding, "I’m disappointed that the usual suspects are still usual."

The lack of transparency in the selection process “raises a red flag” and “doesn’t pass the smell test,” he added.

Reg comment

The case is another “cy pres” settlement in a series of privacy cases against Facebook and Google. It’s fascinating for revealing cosy relationships between what should be the poacher and the gamekeeper.

Cy pres allows the judge to award payouts to intermediaries, leaving nothing to individuals, and it’s skewed the incentives for all those involved in the litigation in a way critics find disturbing. Far from watching your back, digital rights groups and activist academics have an incentive to make a tame settlement quickly, pocketing a substantial amount of cash, but leaving nothing for the ordinary Jane or Joe whose privacy was violated by the tech giant.

Marc Rotenberg’s EPIC has objected to the settlement:

The proposed settlement is bad for consumers and does nothing to change Google’s business practices, EPIC argues in a court filing:

The company will simply revise its notice so that it may continue to engage in the privacy-invading practice that class counsel claimed at one time provided the basis for class action certification and monetary relief. The settlement confers no monetary relief to class members, compels no substantive change in Google’s business practices, and misallocates the cy pres distribution to organizations that, save one, are not aligned with the interests of class members and do not further the purpose of the litigation.

EPIC also noted the obvious about the proposed recipients of Google's cash:

With one exception, they are not consumer privacy organizations and they do not seek to limit the privacy impact of advertising practices that adversely impact Internet users.

Consumer Watch also opposes the deal.

Aligning “citizens' groups” and "tech rights" with Google and Facebook's commercial interests has not been entirely unsuccessful. When the Court of Justice of the European Union ruled on ordinary people’s right to influence their reputation, privacy groups were conspicuously silent. And departments such as the Google-supported Oxford Internet Institute went into bat for the giant ad-broker. One even found himself appointed to be one of Google’s 'Right To Be Forgotten' advisors.

Three years ago, Google made a deal to settle a class action brought against its Buzz service by dispersing $8.5m to a dozen groups, including $1m to the Electronic Frontier Foundation. In that settlement, the lawyers were awarded $2m. And Google managed to find $500,000 for an obscure ethics department at Santa Cruz University – where the presiding judge in the case taught. The judge justified the money-go-round by arguing that that individual citizens would gain “indirect benefits” from the deal.

The arrangement came to light when a privacy group that had been omitted from the deal, EPIC, objected.

The following year, Facebook made a similar deal, rewarding organisations rather than individuals in another cy pres arrangement, this time over the use of individuals’ mugshots for Sponsored Stories. In that case, US Supreme Court Justice John Roberts expressed his concerns over "disconcerting features" of the settlement, and the growing use of cy pres in class action cases in general, cautioning that “in a suitable case, this court may need to clarify the limits on the use of such remedies".

By 2013, groups were being formed simply to be recipients of Silicon Valley’s privacy slush fund – as Chris Castle describes here. ®

* The case is Google Referrer Header Privacy Litigation, 10-cv-04809, U.S. District Court, Northern District of California (San Jose)

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