Google Pays $8.5M to Settle Buzz Privacy Lawsuit

Google will shell out $8.5 million to settle a class-action lawsuit with seven people who argued the Google Buzz social service violated users' privacy.

Google appeared to launch Buzz Feb. 9 with good intentions, allowing users to opt in to a service that lets users share and discuss links, photos and videos with their Gmail contacts.

However, the company quickly ran afoul of users who realized their e-mail contacts were being exposed to users of Buzz with whom they did not want to share their contacts.

The lack of explicit permissions irked people who felt Google was taking too much license with their data.

Google scrambled to close these privacy holes and add more user controls, but the damage had been done.

Seven individuals filed a class-action suit in San Francisco court, arguing that Google violated privacy law in with Buzz.

The AFP said the plaintiffs will receive $2,500 apiece, with most of the settlement money funding organizations focused on Internet privacy policy or privacy education. Some $2 million will go to the plaintiffs' attorneys.

Google Buzz was the first of two major privacy snafus on Google's part this year. The search engine in May admitted its Street View cars has accidentally collected 600 gigabytes of user data from WiFi networks in countries all over the world.

Google is working with those companies to give back the data or destroy it. Privacy regulators in Germany and attorneys general in the U.S. are hounding the company hard over this. Consumer Watchdog made this video mocking the company over this.

The company Sept. 3 also took steps to streamline its privacy policies, which tend to be long winded for most Internet companies where users' digital data is at stake.

For example, Google has removed policies for 12 specific products, instead lumping Web services such as Gmail, Talk, Calendar and Docs under one privacy policy.

These privacy policy updates will take effect on Oct. 3.

Google isn't the only company whose privacy protocols have proven long-winded. As this piece in The New York Times noted, Facebook's privacy policy was once longer than the U.S. Constitution.