Published by LawTechie - August 20, 2012 - LawTechie

FacebookThe Hollywood Reporter weaves a tantalizing conspiracy story (sincerely, it is tantalizing) about how Facebook’s cy pres settlement payments in the latest privacy class action lawsuits may, in fact, be backhanded methods of buying support of organizations that would have Facebook’s back in any copyright litigation versus Hollywood. Some background:

cy pres [is] a legal doctrine born out of Norman French and old estate law that roughly means that when it’s hard or impractical to award compensation in court cases, payment can be made as “near as possible,” including to not-for-profit organizations with similar interests.

In Facebook’s case, the company has recently been trying to settle a privacy class action via $10mm to plaintiffs’ lawyers, $10mm in cy pres money to various privacy non-profits, and $37,500 to the actual class plaintiffs. The judge said “no”:

The rejection of a settlement where half of the money was to go to lawyers and half to “charity” and almost nothing to actual victims could bolster attention on a maneuver that allows big tech companies like Facebook and Google to funnel money to organizations that are hostile to Hollywood’s pro-copyright agenda.

Interestingly…

In a column for Forbes in late July, legal analyst Roger Parloff pointed out that a good chunk of cy pres money awarded in privacy cases is going to organizations that “would very likely be getting at least some donations from Google or Facebook” anyway. He notes that recipients Electronic Frontier Foundation, the Center for Democracy and Technology, and the Center for Internet and Society at Stanford collect voluntary contributions from the two big tech companies and “all reliably line up on the tech sector side in scrimmages with copyright holders.”

This stuff may not quite rise to the level of a paperback thriller, but it certainly entertained this IP lawyer’s morning.

LawTechie is a blog focusing on trends in tech and digital media. Areas covered include intellectual property, cyberlaw, venture capital, transactions and litigation as they relate to the emerging sectors. The blog is edited by the firm's partner Tim Bukher with contributions from the firm's experts in their respective areas of law.

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