Back in 2011, Facebook struck a deal with a small group of attorneys to get them off the hook for a major violation of privacy in which they posted the records of subscriber purchase and video-rental information online.
The two sides struck a deal that paid the attorneys in the case $2.7 million plus a charitable donation to a foundation of Facebook's control. The members of the public who filed the class-action suit got nothing and were told that the charitable donation was better "than a $1.12 check to each member of the class,” according to the attorney who struck the deal and came out a lot richer than he went in.
This took place in a federal appeals court and passed with a 2-1 decision. However, the dissenting opinion rings a familiar bell in terms of major companies getting off light.
From The New York Times:
“This settlement perverts the class action into a device for depriving victims of remedies for wrongs,” Judge Kleinfeld wrote, “while enriching both the wrongdoers and the lawyers purporting to represent the class.”
The lead attorney on the case worried that using a charitable donation as a means of justice by distorting the definition of cy pres sets a dangerous precedent.
“Cy pres awards only increase the risk of collusion,” he said, “because they facilitate settlements that are cheaper and easier for defendants, still provide high fees for class attorneys, but sell class members down the river.”
Though a long-shot, this petition seeks to have the Supreme Court hear the case and possibly overturn the one-sided decision.
