LinkedIn.com Pays $13M To Settle Email Harvesting Class Action

LinkedIn.com Pays $13M To Settle Email Harvesting Class Action
By Jody Godoy.

Law360, New York (June 12, 2015, 2:00 PM ET) — LinkedIn Corp. agreed to shell out $13 million and change certain site features to settle a proposed class action claiming the networking site sneaked into users' email accounts to send invitations to potential members, according to a proposed deal filed in California federal court Thursday.

According to the terms of the settlement, the online professional networking service will set up a $13 million fund to provide cash payouts for eligible class members and attorneys' fees of up to $3.25 million. In addition, LinkedIn has agreed to add more detailed disclaimers to its Add Connections feature and allow users who have agreed to let the site email their contacts withdraw permission to prevent follow-up emails.

LinkedIn is "pleased to resolve this case," spokesperson Kenly Walker told Law360 in a statement. "We will continue to look for additional ways to improve our members’ experiences on LinkedIn.”

The settlement class includes all LinkedIn members who used the Add Connections feature between September 2011 and October 2014 and had emails sent by the site to non-members containing the LinkedIn member's likeness or identity. Class members will have 60 days from the final settlement to file a claim.

The named plaintiffs, all professionals who have used the networking site, sued LinkedIn in 2013 over the Add Connections feature, claiming the company accessed their email contacts without their express consent in a deceptive scheme to expand the service.

After collecting email addresses from members' address books, LinkedIn then sends out multiple emails, ostensibly on behalf of the user, advertising the site to those nonmembers and provides no functional way to stop the subsequent email blasts, according to the complaint.

LinkedIn had argued in a motion to dismiss the suit that its members consent to the practice when they sign up, noting that users must click through a series of detailed permission screens before LinkedIn accesses their email accounts.

Pending approval of the settlement, those disclosures will become even more detailed. LinkedIn has agreed to change the disclaimer on the screen asking for users' consent to access their third-party email accounts. The current disclosure says the site won't “email anyone without your permission,” and the new one will tell users the site will “import your address book,” according to the proposed settlement.

The networking service will also add a link on the permission screen to a blurb that further explains, “when you import your address book, we’ll upload detailed information about your contacts to our LinkedIn servers” and that the information will be used to help the user find connections on LinkedIn, the parties said in their filing. The blurb will contain yet another link to an additional help page with more information, according to the proposed settlement.

LinkedIn also agreed in the proposed deal to tell users upfront that up to two reminder emails will be sent to contacts they invite to join the network, and allow users to withdraw invitations they send through the Add Connections feature to prevent their contacts from receiving follow-up emails.

According to Thursday's filings, the parties had started working on a settlement in August and reached a tentative agreement at a mediation session in January that stretched late into the night.

The parties stipulated that if payments to each claimant fall below $10, LinkedIn will pony up an additional $750,000. If the number of claims makes splitting and distributing the funds economically unrealistic, the settlement money will revert to digital advocacy organizations Access Now and Electronic Privacy Information Center and the Network for Teaching Entrepreneurship, an educational non-profit. No settlement funds will go back to LinkedIn, according to the filings.

The proposed settlement will allow class representatives to ask the judge for up to $1500 each.Counsel for the parties did not immediately respond to requests for comment Friday.

The plaintiffs are represented by Dorian S. Berger and Daniel P. Hipskind of Olavi Dunne LLP, Larry C. Russ of Russ August & Kabat, and Michael W. Sobol, Nicholas R. Diamand and Melissa Gardner of Lieff Cabraser Heimann & Bernstein LLP.

LinkedIn is represented by Jerome C. Roth, Rosemarie T. Ring, Jonathan H. Blavin and Adam I. Kaplan of Munger Tolles & Olson LLP.

The case is Perkins et al. v. LinkedIn Corporation, case number 5:13-cv-04303, in the U.S. District Court for the Northern District of California.

–Additional reporting by Lance Duroni. Editing by Emily Kokoll.