In July 2022, Facebook agreed to pay $90 million to settle a lawsuit that claimed the social media company violated users’ privacy by tracking their internet activity even after they logged off the Facebook platform. As part of the settlement, Facebook agreed to pay compensatory damages to users who filed valid claims. With millions of Facebook users potentially eligible for payouts, many are wondering – how much will each user get from the settlement?
The Background of the Lawsuit
The lawsuit originated in 2012, when Facebook users accused the company of violating federal and state privacy and wiretapping laws by tracking their internet activity even after they logged out of Facebook. The plaintiffs claimed that Facebook installed cookies on users’ browsers that tracked which websites they visited, what they clicked on, and other online activity. This data was allegedly used to build detailed profiles on users for ad targeting purposes.
According to the plaintiffs, Facebook led users to believe that logging out of Facebook would stop the tracking. But in reality, the tracking continued unless users also cleared the browser cookies that Facebook installed. The plaintiffs viewed this as a deceptive business practice that violated user privacy and federal wiretapping laws which prohibit the unauthorized interception of electronic communications.
Facebook denied any wrongdoing, arguing that users consented to the cookie tracking when they agreed to the company’s Terms of Service. However, after nearly 10 years of litigation, Facebook agreed to settle the lawsuit in July 2022, without admitting any wrongdoing.
Settlement Terms
Under the settlement terms, Facebook agreed to pay $90 million into a settlement fund that will be used to compensate eligible Facebook users who filed claims. The settlement class includes users in the United States who between April 2010 and September 2011 visited non-Facebook websites that displayed Facebook’s “Like” button and had their online activity tracked through Facebook cookies.
To be eligible for a payout, class members must file a valid claim by November 23, 2022. The settlement administrator will then calculate each claimant’s share of the fund based on how frequently the user was exposed to the Facebook “Like” button during the claims period. Users who were tracked more frequently are entitled to larger shares of the settlement money.
Settlement Payout Calculations
According to court filings, the settlement administrator will use a formula to calculate each claimant’s pro rata share of the $90 million fund. The formula is based on the number of weeks the user was logged into Facebook and personally visited at least one website containing the “Like” button during the claims period. Specifically:
- For each week a claimant was logged into Facebook and visited at least one website with the “Like” button, they receive 1 point.
- The total points for all claimants are added up to determine the aggregate points.
- Each claimant’s points are divided by the aggregate points to determine their percentage share of the settlement.
- The percent share for each claimant is multiplied by the $90 million fund to determine their payout amount.
For example, if a claimant was logged into Facebook and visited “Like” button websites for 20 weeks during the claims period, they would receive 20 points. If the total points for all claimants was 1 million, that claimant’s share would be 20/1,000,000 = 0.002%. That percent share of $90 million would equal a payout of around $1,800.
Estimated Payouts Per Claimant
It’s impossible to know exactly how much each claimant will receive, since the final amounts depend on how many valid claims are filed. However, court documents indicated the average payout could be around $200, while heavy Facebook users could receive up to $400.
To estimate potential payouts, we can look at Facebook’s user statistics during the claims period:
| Year | Monthly Active Facebook Users |
|---|---|
| 2010 | 500 million |
| 2011 | 800 million |
Based on these figures, there were likely 600-700 million monthly Facebook users during the 18-month claims period. Of course, not all of those users will file claims – the settlement website says hundreds of thousands of claims have been filed so far.
If we conservatively estimate that 1 million claims are filed, the $90 million fund would be divided up as follows:
| Total Settlement Fund | $90,000,000 |
|---|---|
| Estimated Total Claimants | 1,000,000 |
| Payout Per Claimant | $90 |
With 5 million claimants, the estimated payout would be $18 per claimant. And with 10 million claims, the estimated payout drops to $9 per claimant.
Based on these rough estimates, it seems reasonable to expect the average payout to fall in the range of $9 to $90, with heavy Facebook users potentially receiving up to $400. But again, the final amounts could vary significantly depending on claim rates.
Factors That Could Impact Payout Amounts
There are several key factors that will determine the final payout amounts per claimant:
Number of Valid Claims Filed
The more claims that are filed, the smaller each individual payout will be, since the $90 million fund is distributed among more people. If only a small percentage of eligible claimants file, the payouts will be larger.
Frequency of Exposure to “Like” Button Tracking
Since payouts are based on tracking exposure, heavy Facebook users from the claims period who visited many “Liked” webpages will receive larger shares than lighter users.
Amounts Requested for Legal Fees and Expenses
The plaintiffs’ lawyers will request up to 30% of the $90 million fund, or $27 million, to cover their legal fees and expenses for the decade-long litigation. The court will determine the reasonable amount to award – the more that goes to lawyers, the less available for claimant payouts.
Administration Costs
Funds will be set aside to pay the settlement administrator’s costs for notifying claimants, processing claims, and sending payments. Higher administration costs mean less money left for payouts.
Amounts Approved for Incentive Awards
The 12 named plaintiffs in the lawsuit will ask the court for incentive awards up to $5,000 each for their role representing the class. If approved, these awards will reduce the amount available to other claimants.
Steps to Receive a Payout
Eligible Facebook users must submit valid claims to receive their share of the settlement. Here are the steps to file a claim:
- Go to the official settlement website facebookTrackingSettlement.com.
- Click on “File a Claim” and provide your name and contact information.
- Confirm that you had an active Facebook account and visited non-Facebook websites containing the “Like” button between April 2010 and September 2011.
- Select whether you want to receive your payment by check, PayPal, Venmo, or Zelle.
- Submit your claim by the deadline of November 23, 2022.
The settlement administrator will verify each claim. If validated, payments will be issued after the court gives final approval to the settlement in early 2023.
Conclusion
While the final payout amounts won’t be known until all claims are processed, it appears that the average payment per claimant will likely be around $100, with potential payments up to $400 for power Facebook users based on estimates using available information. Of course, many factors could alter these estimates so nothing is guaranteed. Users who want a portion of the $90 million settlement fund must submit valid claims by November 23, 2022.