Facebook's ‘Friend Finder’ Illegal: German High Court

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By Jabeen Bhatti

Jan. 14 — Germany's Federal Court of Justice ruled Jan. 14 that Facebook Inc.'s feature allowing the social network to mine users' contacts data and send e-mails to non-members to join is “nuisance advertising” that violates data privacy and competition law.

The landmark ruling affirmed two lower court decisions. The Federal Court of Justice said the feature known as Friend Finder constitutes “an unreasonable harassment” under Germany's Unfair Competition Act, which considers “annoying” marketing practices, as well as automated ones illegal.

The court also said Facebook wasn't adequately informing its users about what it was doing with their data.

“The on-screen note in the registration process, ‘Are your friends already on Facebook?’ does not clarify that it will import contact details from the user, analyze them and dispatch e-mail invitations to those not registered as members of Facebook,” the court said.

In a Jan. 14 statement, Facebook said it would review its Friend Finder service after receiving the full decision, which hasn't been publicly released.

“Like other internet services that provide features like ’find a friend’ that the court reviewed, we await its full decision and will study it carefully to assess any impact on our services today,” a Facebook spokesman said in the statement.

Consumers Don't Want to Be Bothered

The Federation of German Consumer Organizations (VZBV) filed the lawsuit in 2010, and the court of first instance—Berlin Regional Court (Landgericht Berlin)—found March 6, 2012 that the Friend Finder feature violated German data protection laws (11 PVLR 522, 3/19/12). On appeal, the Higher Regional Court of Berlin affirmed Jan. 24, 2014 (13 PVLR 388, 3/3/14).

“Our perseverance pays off,” Klaus Müller, chairman of the VZBV, said in a statement. “The disclosure of personal data of friends, colleagues or business partners on the Facebook Friend Finder is tricky. These people have not given consent that their data will be used by Facebook for this purpose. The rules on unauthorized advertising exist for reason—consumers do not want to be bothered.”

“What the judgment means exactly for the current Friend Finder, we now have to see,” he added. “In addition to Facebook, other services utilize this form of advertising to attract new users. They will probably now have to rethink how they do this.”

Attorneys: A ‘Landmark Ruling.'

Attorneys told Bloomberg BNA that the ruling will affect “many other business.”

“There are many other operators emulating Facebook's Find Friends feature,” said an attorney who asked not to be identified because his firm has represented Facebook in the past. “We have been warning our clients for years that this could happen.”

Attorneys said that Facebook and others with finder functions could still retain the tool, if modifying it to provide a clearer explanation to users in the form of a more explicit warning. They added that it would be difficult to do that and still keep the function as effective.

“I don't agree with the decision,” the attorney said. “The judges took a very conservative view—they haven't grown up in the internet age, and they acted as if they were stumbling upon Facebook for the first time.”

To contact the reporter on this story: Jabeen Bhatti in Berlin at correspondents@bna.com

To contact the editor responsible for this story: Jimmy H. Koo at jkoo@bna.com

For More Information 
Full text of the Federal Court of Justice's Jan. 14 announcement of its ruling is available at http://src.bna.com/b2X.