• by Wendy Davis  @wendyndavis, June 1, 2011

A federal judge has approved an $8.5 million settlement of a class-action privacy lawsuit against Google, stemming from its launch in 2010 of the social network Buzz.

Fourteen privacy organizations and nonprofits will split around $6 million of the settlement, with the bulk of the remainder going to the plaintiffs' attorneys.

The original agreement called for the money to go to 12 entities, but U.S. District Court Judge James Ware ruled this week that the Electronic Privacy Information Center and Markkula Center for Applied Ethics at Santa Clara University also should receive $500,000 each. Both of those entities had applied to receive the funds, but were left out of the original proposed settlement.

"The court does not find good cause to exclude EPIC from the list of recipients," Ware wrote. "EPIC has demonstrated that it is a well-established and respected organization within the field of Internet privacy."

EPIC had previously filed papers arguing that it should be added to the list of recipients. The organization said at the time that it "has done far more to advance the interests of the class than has any other party."

Kirk Hanson, executive director of the Markkula Center, says the school likely will use the money to create a model curriculum about Internet privacy for undergraduates. The center also plans to develop a site that "identifies and discusses choices users must make regarding their own privacy online."

Other organizations to receive a portion of the settlement include the Electronic Frontier Foundation ($1 million), Harvard's Berkman Center for Internet & Society ($500,000 each) and the Center for Democracy & Technology ($500,000).

The settlement ends civil litigation stemming from Google's decision to launch the social-networking service Buzz on an opt-out basis. At launch, the service revealed information about the names of users' email contacts, if users activated Buzz without changing the defaults. The result was that people's confidential information -- such as names of their doctors, lawyers or coworkers -- could become public.

Google quickly revised the service, but seven Gmail users nevertheless filed class-action lawsuits, which were consolidated into one litigation. Last September, the company agreed to resolve the case by paying $6 million to various privacy organizations and around $2.5 million to the lawyers that brought the case.

Independent of the civil lawsuit, EPIC filed a Federal Trade Commission complaint about Buzz. Google recently agreed to settle that matter by creating a comprehensive privacy program and also submitting to independent privacy audits for the next 20 years. Google also promised to obtain users' explicit opt-in consent before sharing their information more broadly than its privacy policy allowed at the time of collection.

EPIC argued in court papers that it was especially entitled to a share of the proceeds of the class-action lawsuit because its FTC complaint appears to have resulted in the agency's enforcement action.