Facebook Defends Ad Offerings as Another Privacy Lawsuit Surfaces

As Facebook battles privacy lawsuits filed by consumers and scruitiny from legislators about data security and privacy, the firm aims to educate people about Facebook advertising and the data driving it.

“We never share your personal information with advertisers,” wrote Facebook COO Sheryl Sandberg in a July 6 post on the company’s blog. “We never sell your personal information to anyone. These protections are yours no matter what privacy settings you use; they apply equally to people who share openly with everyone and to people who share with only select friends.”

Despite Facebook’s insistence that it respects user privacy and does not share personal information with third parties such as advertisers, suggestions to the contrary in the form of lawsuits and government scrutiny persist. The most recent example is a class action lawsuit filed in a Canadian court on July 2, which contends that Facebook makes public and “shares, uses, and disseminates the personal information of its users to third parties for commercial purposes or economic benefit.”

According to the complaint posted online, plaintiff Donald J. Woligroski, who resides in Winnepeg, Manitoba, is looking to obtain damages from Facebook for a variety of alleged violations of his user contract, such as invasion of privacy, appropriation of identity, deceit, and conversion of personal information. A Facebook spokesperson told ClickZ News the company has not yet received the complaint.

The suit argues that changes Facebook made to its privacy options in 2009 “decreased Users’ control over their personal information,” and “were made without proper and informed consent and authorization of Users.”

The suit suggests Facebook users are at risk for “identity theft, data mining, harassment, embarrassment, intrusion, and all types of unauthorized use” of the information they post to the site.

Reportedly, all Canadian Facebook users would be considered members of the class suing the social network. Merchant Law Group, the law firm that launched the case against Facebook, has a form on its site for Canadian Facebook users interested in joining the suit.

Facebook also faces an appeal of a settlement ruling on a class action suit filed in relation to the company’s Beacon program, which when introduced, exposed recent purchases of its users to others on the site. The appeal in U.S. District Court argues that Facebook should have to compensate class members for violation of privacy rights. Instead, the settlement called for Facebook to establish a new foundation intended to fund privacy organizations.

The Canadian lawsuit argues that Facebook unfairly benefits financially from allowing advertisers, site publishers, and app developers to access profile information posted by users. For instance, search engines are able to crawl publicly-available Facebook data and expose it in search results. Facebook allows users to restrict access to profile information such as posts, birthdates, or political views only to friends, specific friends, or even themselves only; however, the suit suggests that Facebook’s privacy controls are “materially deceptive, confusing, and ineffective.”

Facebook’s Sandberg stated in her post yesterday, “The only information we provide to advertisers is aggregate and anonymous data, so they can know how many people viewed their ad and general categories of information about them. Ultimately, this helps advertisers better understand how well their ads work so they can show better ads.”

Facebook also has been subject to criticism from U.S. legislators calling for the company to adopt an opt-in policy for third-party data sharing. In light of increasing concerns among legislators over the company’s data privacy protection and ad targeting on the site, Facebook’s public policy team has been making an effort to educate U.S. lawmakers and staff about the service and its privacy protection capabilities.