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Supreme Court Lets Stand Contested Facebook Settlement, But Chief Justice Cautions About Future Cases

The Supreme Court has denied a petition for review in Marek v. Lane, a decision upholding the class action settlement of Facebook’s controversial "Beacon" Program. The settlement provided substantial fees to attorneys, no benefits to class members, and established a funding entity, controlled in part by Facebook "Cy press" ("as near as possible") is a legal doctrine that allows courts to allocate funds to protect the interests of individuals when there is a class action settlement, but concerns have been raised about the misuse of cy pres procedures. Chief Justice Roberts, focusing on the "unusual" allocation of funds in the Facebook matter, suggested that the Supreme Court would eventually need to address "fundamental concerns surrounding the use of such remedies in class action litigation" including "how to assess its fairness as a general matter; whether new entities may be established as part of such relief; if not, how existing entities should be selected; what the respective roles of the judge and parties are in shaping a cy pres remedy; [and] how closely the goals of any enlisted organization must correspond to the interests of the class." EPIC and other consumer privacy organizations have routinely raised similar concerns about abuse of the class action process. For more information, see EPIC: Fraley v. Facebook, EPIC: Lane v. Facebook, and EPIC: In re: Google Buzz.

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