Social media firms offer $5.3M settlement in iOS app privacy suit over contact uploads

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A group of eight social media companies, including Twitter and Instagram, have agreed to pay a total of $5.3 million to settle a 2012 class action lawsuit which alleges user privacy was breached when the apps leveraged an iOS feature that uploaded details from users' contact lists.

The settlement agreement, filed earlier this week in a San Francisco federal court, proposes that Twitter, Instagram, Foursquare, Yelp, Path, Gowalla, Foodspotting, and Kik pay into the $5.3 million fund, reports Law360. Aside from attorney's fees, the settlement will be provided to qualifying claimants, defined as anyone in the United States who downloaded and used the apps between 2009 and 2012.

The millions of downloads for each app could mean that those applying for a payment may receive only a small cut, but are eligible for up to eight shares if they used all of the identified apps. If the settlement is accepted by the judge, the payments could be made out to claimants later this year in the form of checks and Amazon credit.

The five-year-old suit centers around a feature of iOS developers could integrate with their app, one that allowed users to find others on their contacts list who used the same online service. It is claimed the app developers violated user privacy by not informing them that the feature would upload a list of user contacts to the companies' servers for cross-checking.

The defending companies argue that transferring and storing contact lists on their servers is required in order for "Find Friends" to correctly function, and had gained permission to do so, but U.S. District Judge Jon Tigar disagreed.

According to a Courthouse News Service report concerning Yelp's arguments, Judge Tigar ruled in September last year that the companies did not explicitly disclose to users their intentions to upload the contact information. Judge Tigar also dismissed arguments that users agreeing to terms of service and privacy policies was sufficient enough consent for the data transfers, as the privacy policy terms were not on-screen within the apps, and accessible only by a link to an informational webpage.

While the eight firms will effectively end their participation in the class action suit if the court accepts the proposed settlement, the class action case will still remain active. After starting with 18 defendants, only Apple and LinkedIn will continue fighting the case in court.