Facebook's Sponsored Stories Costs it $20 Million, Nets Users $15 Each

Facebook will pay $20 million for putting users' names and faces in its "Sponsored Stories" advertising program without their permission.

A federal judge granted final approval (see the full order below) to settle the lawsuit over targeted advertising.

Qualified users who joined the class action by the May 3, 2013 deadline will receive $15 from Facebook for having their photos and names featured in "Sponsored Stories." Five plaintiffs originally filed suit in 2011 because the site shared users' "likes" of certain advertisers with friends without paying them or allowing them to opt out.

A "Sponsored Story" is an advertisement that appears on a member's Facebook page and generally consists of a friend's name, profile picture and an assertion that the person "likes" the advertiser.

The case has highlighted tension between privacy concerns and Facebook's drive to monetize user content.

Facebook's Sponsored Stories Costs it $20 Million, Nets Users $15