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Court Orders Facebook to Fund $9.5M Online Privacy Foundation

26 Oct, 2009 By: Erik Gruenwedel

A U.S. District Court judge has ordered social network Web site Facebook to fund a nonprofit online privacy foundation as the result of a class-action lawsuit that ensnared third parties, including Blockbuster.

At issue was a software program called Beacon that allowed Facebook friends to share personal consumer habits. Controversy erupted when it was found that Facebook members were automatically included in the program instead of voluntarily opting-in.

Specific to Blockbuster, litigants complained that movie rental selections were made public on Facebook without their consent.

Judge Richard Seeborg mandated Facebook pay $9.5 million toward the foundation that will fund projects that promote online privacy, safety, and security.

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