Stakeholders Look to FTC to Address Growing Use of Social Media Info in Advertising

A class action lawsuit filed Jan. 9 alleges Facebook incorporates false “likes” into ads (http://bit.ly/1m3utFy). Anthony Ditirro filed the suit in the U.S. District Court in San Jose, alleging the social media company is “unlawfully using its customers’ likenesses and Facebook profiles to create a false impression that its customers are promoting a particular company or product without said customer’s knowledge or consent.” The suit is seeking upwards of $5 million for the “proposed class numbering in the millions,” that this alleged practice affects, the lawsuit said.

The use of “likes” in advertisements started in August, when Facebook updated its data use policy with language allowing the company to repurpose user information for advertisements (http://bit.ly/1aeqdhb). Previously, the policy said users could “use your privacy settings to limit how your name and profile picture may be associated with commercial, sponsored, or related content (such as a brand you like) served or enhanced by us.” The new language reads: “You give us permission to use your name and profile picture, content, and information in connection with commercial, sponsored, or related content (such as a brand you like). This means, for example, that you permit a business or other entity to pay us to display your name and/or profile picture with your consent or information, without any compensation to you.”

Six privacy advocacy groups sent a joint letter to the FTC asking the commission to block the change (http://bit.ly/1gBr4N0) the day before it took effect Sept. 5 (http://on.fb.me/KfucTu). “The changes violate Facebook’s current policies and the 2011 Facebook settlement with the FTC,” the letter argued. The 2011 settlement mandated Facebook receive “affirmative express consent” from users “prior to any sharing of a user’s nonpublic user information by [Facebook] with any third party, which materially exceeds the restrictions imposed by a user’s privacy setting(s)” (http://1.usa.gov/1ePcNLu). The FTC and Facebook had no comment.

Google made a similar change in October. Google Plus user’s images could now appear in an ad if that user had “+1'd” -- the equivalent of “liking” -- something, according to a summary of the changes (http://bit.ly/1cfruEs). Similar to Facebook, Google users could opt out (http://bit.ly/J8bm0r), but the default setting opted in all users. In a summary of the changes, the company said the change would help tailor results and advertisements to each individual user. “We want to give you -- and your friends and connections -- the most useful information,” it said. “Recommendations from people you know can really help.” Google had no additional comment.

"That’s what these companies would like you to think,” said Deborah Peel, head of the board of Patient Privacy Rights, a consumer rights and privacy advocate. The changes are simply about enhancing profit, she said: “They're profiting from really ripped off, stolen and used content from users.” Information posted to social media sites should be treated as “single use” information. And it’s single use is to be shared with the people the user originally designates, said Peel. Social media content is a “valuable asset,” she said, but people haven’t fully realized it. Social media companies shouldn’t be allowed to take advantage of that, Peel said, and treat users as if they have gone through “some kind of conscious thought process” before posting information or “liking” products.

Peel considers it a “false and deceptive trade practice.” Peel has multiple meetings at the FTC lined up in January, she said. At least one is with FTC Commissioner Julie Brill, who has focused numerous public speeches on giving consumers greater control over how their data is used (WID Dec 20 p2). “We really need to control who knows what about us,” Peel said. She plans to encourage the FTC to take a bigger role in this control, she said.

Using social media content in third-party advertising has also raised copyright questions, several lawyers and academics told us. On Jan. 4, CBS Films ran a full page ad in The New York Times for the film Inside Llewyn Davis,” featuring a partial tweet from film critic A.O. Scott, according to multiple reports. The incident has raised questions about Twitter’s terms of service, the scope of fair use, and best practices for advertising and marketing.

"I've never seen anything quite like this,” said Brad Greenberg, intellectual property fellow at Columbia University Law School. Even though tweets are “very clearly copyrightable material,” it’s difficult not to see the “quoting of a tweet, especially a tweet from a movie critic” as “fair use,” he said. “State law claims” could strengthen his case, such as “false endorsement” or “right of publicity,” but “that argument is a lot stronger if the person who can bring the claim isn’t a professional critic,” he said. From a copyright standpoint, CBS Films “probably doesn’t have much to worry about."

The incident raises “interesting questions” about “which laws apply” and perhaps “what’s polite or what’s good practice” in advertising, but “from a copyright law standpoint, I think it’s just a fair use question,” said General Counsel David Sohn of the Center for Democracy & Technology’s Project on Copyright and Technology. “Having made a public statement, via a tweet, it seems to me that normal principles of fair use allow other people to use quotations of what other people are saying,” he said.

Twitter’s terms of service don’t allow third parties to use tweets “without explicit permission of the original content creator” (http://bit.ly/18dVoO1). But Scott’s position as “a famous movie critic” protects the use of his commentary since “criticism is paradigmatic fair use,” said Derek Bambauer, a law professor at the University of Arizona who specializes in Internet law and intellectual property.

But the vast majority of social media users are not famous, which is what worries Center for Digital Democracy Executive Director Jeff Chester. “The growing use of social related data collection is a privacy and consumer protection concern,” he told us. Chester is looking to the FTC to address the issue in its spring privacy workshops (http://1.usa.gov/1jY27hV). The commission’s data broker study -- which FTC officials have said to expect soon -- will be another chance to gauge the FTC’s thoughts on the issue, he said. (cbennett@warren-news.com),