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Facebook, Zynga Users Try to Revive 2010 Privacy Lawsuits

Facebook Inc. (FB) and Zynga Inc. (ZNGA) should be ordered to face claims that users’ identities and activities on the social networking platforms were disclosed to third parties without their consent, plaintiffs’ lawyers told a federal appeals court panel.

The plaintiffs are asking the U.S. Court of Appeals in San Francisco to revive complaints filed in 2010 and dismissed the following year. Some of their claims are are based on privacy practices and policies that the companies have since changed, their lawyers said.

U.S. Circuit Judge Richard Tallman told the lawyers at a hearing today that Congress couldn’t have imagined the alleged violations of the Stored Communications Act in its “wildest dreams” when it wrote the law.

“Part of the problem is we’re dealing with statutes written long before this technology existed,” Tallman said. The judge said he was skeptical anyone was misled by the privacy policies that are being challenged. He also said “there has to be substantial value to the information” the companies are gleaning from users “or Facebook and Zynga wouldn’t be doing what they’re doing.”

Multiplying Lawsuits

Privacy lawsuits against Facebook have multiplied as users become more aware of how much personal information they’re revealing, sometimes without their knowledge. The company was sued last month in federal court in San Jose, California, the same place the 2010 complaints were filed, over allegations it systematically intercepts its users’ private messages on the social network and profits by sharing the data with advertisers and marketers. Similar claims against Google Inc. (GOOG), Yahoo! Inc. and LinkedIn Corp. (LNKD) are pending in San Jose.

In the 2010 case, Facebook users claim that when they clicked on advertisements, the social network “automatically and surreptitiously” disclosed to advertisers information about them and how they were using Facebook services “contrary to Facebook’s explicit privacy promises.”

In the case against Zynga, which develops social games played on Facebook’s network, users claim the gaming company divulged communications including “personally identifiable information” to third parties without their permission.

Facebook Lawyer

Aaron Panner, a lawyer for Facebook, told the three-judge panel today it didn’t violate the Stored Communications Act because the user information at issue is a record and not the “contents of a communication” as described by the law. As for the users’ claims under California law, they failed to claim any “actual and appreciable damage,” Panner said.

Richard Seabolt, a lawyer for Zynga, told the court the users attempted to “force-fit” their claims into federal wiretap and stored communication laws, and that the “inadvertent” disclosure of Facebook user IDs resulted from the “customary operation of the Internet and browsers” and is no longer an issue.

The appeals court panel didn’t say when it will rule.

The cases are In Re Facebook Privacy Litigation, 12-15619, and In Re Zynga Privacy Litigation, 11-18044, U.S. Court of Appeals for the Ninth Circuit (San Francisco).

To contact the reporter on this story: Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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