A Closer Look At The Google Buzz Privacy Settlement

On December 20th, a federal judge in the Bay Area will be asked to approve an $8.5 million settlement between Google and several Gmail users who sued earlier this year over the way Google Buzz was launched in February. If it’s approved, the case will become a class action, Gmail users in the U.S. will join the lawsuit by default and will immediately be part of the settlement. (There will be ways for Gmail users to remove themselves from the suit if they wish.)

But the settlement offers little benefit for Gmail users outside of the original group of users who sued Google. Why? Because, according to the settlement documentation, attorneys for the plaintiffs “could identify no class members who allege that they suffered out-of-pocket damages.”

Instead, the initial set of plaintiffs stands to receive $2,500 settlement payments each, the attorneys involved would recover their fees and expenses (they’re asking for more than $2 million of the settlement fund), and the rest of the money would be distributed to “existing organizations focused on Internet privacy policy or privacy education.”

All of this came together fairly quickly; court documents mention only two face-to-face meetings between the two sides. Here’s a closer look at the Google Buzz privacy settlement.

Background: In Re: Google Buzz User Privacy Litigation

On February 17, just eight days after Buzz launched, Eva Hibnick filed the initial class action suit on behalf of all U.S. Gmail users who had Buzz added to their accounts. Other Gmail users filed additional suits on March 3, April 5, May 27, and June 7 of this year. On June 30, all cases were consolidated at Hibnick’s request. The consolidated case against Google is called “In Re: Google Buzz User Privacy Litigation.”

All of the original, separate cases focused on similar issues. Namely, that the way Google launched Buzz was a violation of Gmail users’ privacy. Among other concerns, the potential public display of “follower/following” lists “appeared to divulge a Gmail user’s most frequent email contacts without sufficient consent,” they said.

All along, Google has denied any wrongdoing and, according to the settlement, “contends that plaintiffs have mischaracterized and misunderstood how Google Buzz operates.” Google says it “responded quickly to improve Google Buzz and to address concerns that had been raised about it.” (see our story, Google Apologizes, Continues To Tweak Buzz)

Settlement Negotiations Begin

In the midst of this string of lawsuits, negotiating had already begun. Google reached out to the plaintiffs’ attorneys and met with them on April 21st at Google’s attorneys’ offices in San Francisco. In addition to explaining how Buzz works and listening to the plaintiffs’ arguments, court documents show that Google revealed some details of its plans to file a motion for dismissal. Both sides began discussing the possibility of a settlement, and this meeting culminated with an agreement to enter formal mediation.

On June 2nd, the two sides met again in San Francisco for a formal mediation session in front of retired Federal District Court Judge Fern Smith. After a 14-hour discussion of the facts and legal issues, both parties agreed to the foundation of the current settlement.

Those are the only two face-to-face meetings discussed in the settlement documentation.

Determining Damages & Settlement Conditions

As part of the agreement, Google agreed to give the plaintiffs’ attorneys “all consumer feedback that it had received about the Buzz program from Buzz users throughout the world,” along with other factual materials such as sworn statements from Google staff about how Buzz was launched and how it functions.

After reviewing thousands of pages of documents, including about 2,000 emails from Gmail users who provided Google with feedback, the plaintiffs’ attorneys “could identify no class members who allege that they suffered out-of-pocket damages.” The settlement document reiterates this point no fewer than five times, and uses it as a basis for arguing why further individual lawsuits are doubtful:

Here, few if any Class Members suffered out-of-pockets damages and Class Members are therefore are unlikely to pursue litigation against Google on their own.

The settlement calls for Google to establish an $8.5 million fund. Here’s how that will be disbursed if the settlement is approved as presented:

• The original group of seven plaintiffs who filed suit against Google will each get up to $2,500. The document says this sum represents a payment for their time and for leading the Class action against Google.
• The attorneys who’ve been involved in the original cases and the current consolidated case are asking for 25% of the settlement fund to cover their legal fees and expenses.
• The remaining $6+ million will be for organizations that are focused on internet privacy policy and education.

Other Aspects of the Settlement

A number of non-financial things will happen if the settlement is approved in December:

• Google will be required to “undertake wider public education about the privacy aspects of Buzz.” The details of this part of the settlement are still being developed.
• Gmail/Buzz users who remain part of the class action will be unable to pursue any future actions against Google related to this litigation.
• Both sides will create a settlement website to provide information about the settlement. The settlement document lists that web site as buzzclass.com, which is currently a parked domain with private registration.
• Google will notify all affected Gmail users it can identify about the settlement via email, with a link to the settlement website.

The full text of the settlement is available on Scribd.com. We’ve embedded it below. Thanks to Gary P. at ResourceShelf for assistance.

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