infoTECH Feature

May 03, 2011

$3.25 Million Class Action Settlement in Flash Cookies Suit Awaiting Court Approval

Pending court approval of a proposed $3.25 million settlement deal, a class action lawsuit accusing three companies – Quantcast (News - Alert), Clearspring, and Videoegg – of utilizing Flash cookies to continue to track users’ Internet activities without their knowledge or permission, would be dismissed.

Under the agreement, Quantcast and Clearspring (News - Alert) would pay a combined total of $2.4 million and Videoegg (now SAY Media) would pay $825,000 into settlement funds. All have continued to deny any wrongdoing, but do not want to pursue prolonged and costly defenses and potential appeals.

“The Court granted preliminary approval of both the Quantcast/Clearspring settlements, as well as the Videoegg settlement,” said Scott Kamber of KamberLaw, LLC, which represents the plaintiffs. “Thus far there have been no objections to either settlement received by class members. We are confident that we can satisfy our burden at the final fairness hearings to demonstrate that the settlements are fair and reasonable to the Class.”

The settlement funds would not be paid out directly to members of the class action. Rather, much of the settlement will be donated to several non-profit groups whose mission is to educate consumers about online privacy.

The Adobe (News - Alert) Corporation originally created Flash cookies, technically known as “Local Shared Objects” (LSOs), to control its Flash player settings across multiple browsers. Web firms soon realized they could use the same technology to restore deleted browser cookies and track users’ online activity. Adobe has publicly decried this practice.

Actions such as erasing the browser cookies or the cache on your computer, or even clearing the history, has no effect on Flash cookies as they are stored in a separate area and are designed to be used by several different browsers.

As part of the settlement, Quantcast, Clearspring, and Videoegg would agree that they currently do not and will not in the future, use Flash cookies to: (1) “Respawn” browser cookies (Respawning is when a company uses a Flash storage device to back up browser cookies and restore them after a user has deleted them); (2) Serve as an alternative to browser cookies for storing information about a user’s web browsing history, unrelated to the delivery of content through the Flash Player or the performance of the Flash Player in delivering such content, without adequate disclosure; and/or; (3) Otherwise counteract any computer user’s decision to either prevent the use of or to delete previously created browser cookies.

Kamber feels the settlement is beneficial for everyone involved.

“I think it is particularly meaningful to the public,” Kamber said. “It removes a non-disclosed method of tracking from the arsenal of ad networks and puts several major players in this area on record as being opposed to the use of LSO’s for tracking. It clearly sets a standard that says that using LSO’s for tracking is out of bounds. For defendants, it provides closure and is demonstrative of their leadership in recognizing the injury caused by such tracking methods.”

The final approval hearing for the Quantcast/Clearspring settlements is scheduled for June 13, while the approval hearing for the Videoegg settlement is slated for July 18.




John Lahtinen is Community Development Editor for TMCnet. Previously, he served as Director of Publications at Yale Law School. He has 15 years of combined professional and educational experience involving newspapers, media, and communications, including editing, media relations, public relations, news writing, public speaking, layout/design, and marketing. To read more of his articles, please visit his columnist page.

Edited by Jennifer Russell
 
FOLLOW US

Subscribe to InfoTECH Spotlight eNews

InfoTECH Spotlight eNews delivers the latest news impacting technology in the IT industry each week. Sign up to receive FREE breaking news today!
FREE eNewsletter

infoTECH Whitepapers