No Surprise, CIS Reliably Sides With Users

Last week a story appeared in Fortune magazine hypothesizing that Google and Facebook are using cy pres settlements of privacy class actions to improperly channel money to civil liberties groups that reliably support "the tech sector side" in disputes with copyright owners, including my organization, Stanford Law School's Center for Internet and Society. The vision of tech companies and civil liberties groups joining forces against media companies to fight copyright enforcement online is, in my view, a myth. 

First, Google isn't just a tech company anymore. Google has evolved into a media company. It has lucrative deals with personalities and major media companies to produce original content for YouTube and GoogleTV.  It also owns Zagat, and recently took an investment share in Machinima (a YouTube channel of videos about games and gamers).  Google is making and increasingly will make its revenue on original copyrighted content found exclusively on its platform.  Copyright helps Google ensure and enforce that exclusivity. Online copyright, correctly done, is an engine for creativity, and not its enemy.  

However, civil liberties groups oppose copyright interdiction methods that would incentivize communications platforms to eavesdrop on our online conduct and censor our free speech.  If Facebook must proactively supervise one billion users worldwide for copyright infringement, it is going to program machines to read all our posts and messages and auto-delete anything that might be suspicious, whether it is licensed, public domain, fair use, or whatever.  That's Big Brother and prior restraint, rolled into one and enforced by private companies using the same computers that at the birth of the commercial internet we dreamed, and still hope, would liberate rather than enslave us.  So while Google and Facebook simply don't want financial risk, civil libertarians reject the surveillance and control of users that would result from expanding platform liability.

In sum, civil liberties groups are on the same side -- the users' side.  Users don't care about YouTube. We care that there's a place people can post and watch cat videos, and political mashups, indie rom-coms, stand up comedy acts and self-produced rock albums.  Users don't care if Microsoft's Bing beats Google Search. We want search results that return the answers I'm looking for, not the answers that Big Brother thinks are good for me.  Users don't care about Gmail.  We want fast, secure, private, ubiquitous messaging.  Users don't care about Facebook. In fact, we kind of hate Facebook, but we love our friends and we want a platform that let's us share our successes and our defeats with 500 of our closest buddies, but Not A Single Additional Soul.   

This simple pro-user principle explains why CIS is such a fair weather friend to companies.  We often fight positions taken by Google and Facebook on privacy and often support positions taken by Google and Facebook on copyright. I say often because we do not always agree.  For example, platforms probably are not liable for improperly removing lawful posts and have no obligation to restore content that copyright owners wrongfully claimed was infringing.  Perhaps they should. Similarly, and contrary to the claims of the Fortune piece, Facebook was on the sidelines in the SOPA/PIPA debate, even though many Facebook users, and CIS, strongly opposed the law. Sometime soon, on behalf of creators laboring in their garages, or designing on machines in their college computer lab, CIS may oppose a proposed copyright law that Facebook and Google find easy to comply with or otherwise in their best financial interest.  For a time, the public interest community has found common cause with these businesses on some issues.  In the future, civil liberties groups may be less likely to do so.  

The reason CIS gets cy pres allocations in privacy class actions is that our great work directly benefits Internet users whose privacy has been invaded by corporate mishandling of personal data. For example, our work on Privacy by Design applies human-computer interaction research and experimentation to consumer problems such as online privacy. Some of its central insights, for example the idea of “visceral notice”, have been implemented by household name Internet companies, positively effecting user privacy in relation to products we use every day. Residential Fellow Aleecia McDonald co-chairs the WC3’s Do Not Track working group, an ongoing effort to establish international standards for a “do not track” mechanism that users can implement to opt out of certain kinds of advertising, as recommended by the U.S. Federal Trade Commission.  CIS Student Fellow Jonathan Mayer and CIS Junior Affiliate Scholar Arvind Narayanan were instrumental in developing the “do not track” proposal. Further, Mayer’s empirical work on third party tracking practices has resulted in a groundbreaking tool researchers and eventually users can implement to determine the data sharing practices of any web-based service.  Some of that work has been directly critical of Google.  For example, in February 2012, he published research that showed that Google and three other companies had implemented a mechanism that circumvented the protections of the Safari browser against third-party tracking cookies (see link and link). The Wall Street Journal broke the story on its front page after it had independently verified Mayer's results. The news created a public uproar and led to investigations of the practice by regulators in the U.S. and Europe. Google may face fines of up to USD 16,000 per day per violation under a settlement with the Federal Trade Commission, if the FTC finds this to be a violation of users' privacy under the rules of the settlement.

Other civil liberties groups are also doing great work on privacy. I'm grateful for the constellation of internet public interest organizations because each group fills an important niche that the others do not necessarily occupy.  I don't know why EPIC was not included in the initial Google Buzz settlement proposal, but unlike the Fortune writer, I won't speculate.  What we do know is that, contrary to the article's claim that cy pres allocation is secretive and collusive, EPIC followed the public docket filings indicating which groups were nominated to receive the money, filed its objections and convinced the Court that the group's work benefited the class such that it received some of the funds. EPIC has done the same thing in the Facebook Sponsored Stories case, and is waiting for the judge to rule.  Where's the conspiracy?

Without question, there are serious problems with class actions as remedies for Internet privacy violations. One of these problems is that getting payments directly to affected class members can colossally expensive and dysfunctional. For this reason, I believe the principle behind privacy cy pres allocations makes good sense, even as scholars who study class actions have identified ways in which the process could be improved.

 

 

Comments

You argue that it is appropriate for privacy class-actions to be settled by having big tech company defendants shower money on nonprofits like yours, because you do some privacy-related work in addition to the work you do that is hostile to online copyright enforcement. (The latter work is overwhelmingly advantageous to your tech sector patrons in the current environment, regardless of whether your motivations differ from theirs, and regardless of whether that commonality of interest might conceivably one day come to an end.) Is the Center then willing to cordon off these cy pres funds and make certain that the $500,000 received in the Google Buzz award in 2011, and $600,000 you stand to receive from the Facebook Sponsored Stories award in 2012, will be used strictly and only for privacy-related projects that stand a chance of helping the class? (The Center’s 2012 budget is $990,000.)
What is also unseemly about having big tech companies bestow windfalls on nonprofits is that the nonprofits’ independence might be compromised. In the Facebook class action, four digital privacy watchdogs (which have not been cut in on the cy pres award)—e.g., Electronic Privacy Information Center, the Center for Digital Democracy, Consumer Watchdog, and the Privacy Rights Clearinghouse—are opposing the settlement, taking the substantive position that the injunctive relief it affords the class is, as EPIC puts it, “largely illusory.” They have each filed long letters with the court laying out their reasoning. In contrast, you, Ms. Granick, have submitted an affidavit on behalf of the Center supporting the plaintiffs motion for approval of the settlement and saying that the center is “honored to be considered for a $600,000 cy pres award,” but not specifically addressing whether you think the injunctive relief being afforded the class is meaningful or adequate. Tell us, Ms. Granick, does the Center think it is, and why?
(You also allege that I made a factual mistake with respect to Facebook’s position on the SOPA protest, but you have made a factual mistake with respect to what I actually said. I wrote that Facebook opposed the SOPA legislation, which is correct.)

last comment was not anonymous. it was by me, Roger Parloff, the author of the Fortune article in question.

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