Facebook has reportedly agreed to pay 10 million dollars to charity to settle a lawsuit that accused the social networking giant of violating users'' rights to control the use of their own names, photographs and likenesses.
The lawsuit alleged that Facebook violated state law by publicizing users'' ''likes'' of certain advertisers on its ''sponsored stories'' feature without paying them or giving them a way to opt out.
This means if a user clicked the ‘like’ button for a brand, the click might show up as a ‘sponsored story’ on friends'' pages.
The lawsuit, brought by five Facebook members in California, could potentially allow millions of other users to pursue similar legal action against the site.
The settlement, which was reached last month but made public this weekend, raises questions over a major source of ad revenue for the company.
In the lawsuit, Facebook founder Mark Zuckerberg was quoted as saying that a trusted referral was the ''Holy Grail'' of advertising, the paper said.
Also, the lawsuit cited comments from Facebook chief operating officer Sheryl Sandberg, saying that the value of a ''sponsored story'' advertisement was at least twice and up to three times the value of a standard Facebook.com ad without a friend endorsement.