Judge Certifies Class in Facebook In-App Purchases Class Action

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A class of Facebook users who are minors and were allegedly able to make in-app purchases was certified by a California federal judge Tuesday as part of a class action lawsuit, but the refunds they were seeking were tossed.

U.S. District Judge Beth Labson Freeman said that she decided against certifying the class seeking individualized restitution or monetary relief refund claims in cases in which transactions were either void or voidable under California law, saying that the amount of claims seeking restitution would be too overwhelming for there to be an injunction as well, and if the restitution claims were kept, it would not be possible to certify the class.

“The Court . . . agrees with [Facebook] that Plaintiffs’ restitution claims cannot be certified pursuant to Rule 23(b)(2),” Judge Freeman wrote. “First, plaintiffs have not shown how the monetary relief sought would be incidental to the injunctive or declaratory relief. Myriad claims for restitution, even if the monetary amounts sought were relatively small, would overwhelm the claims for injunctive or declaratory relief.”

“Second, the amount of monetary damages due each class member, if any, would be dependent on the individual circumstances of each class member, and thus cannot be determined formulaically,” the California federal judge explained further.

The Supreme Court’s decision [in Wal-Mart Stores, Inc. v. Dukes] therefore precludes these restitution claims from being certified under (b)(2).”

The class certified by Judge Freeman in the Facebook in-app class action lawsuit includes the following: “All Facebook users who are or were minor children according to Facebook’s own records for the four years preceding the date on which the original complaint was filed through the date on which a class is certified (‘the Minor Class’).

“Within the Minor Class is a subclass of Minors from whose Facebook accounts Facebook Credits were purchased (‘the Minor Purchasing Subclass’),” the California federal judge stated.

The Facebook class action lawsuit was filed by plaintiff Glynnis Bohannon of Arizona, representing her minor child, I.B, who with permission from his mother spent “$20 on his Facebook account to purchase Facebook Credits to use in a game called Ninja Saga.”

I.B. gave $20 to his mother and then used her credit card to buy the Facebook Credits. However, he claims that he didn’t know that Facebook would then store the credit card information on his account, which would be used to make additional in-game purchases, believing that the “purchases were being made with virtual currency, and that his mother’s credit card was not being charged for these purchases.”

This resulted in several hundred dollars being charged to Bohannon’s credit card.

A similar situation happened with the minor J.W., who is the son of plaintiff Steven Wright, but those charges totaled $1,000. Facebook refunded $59.90 of the total.

“Both plaintiffs contend that Facebook misinforms its users, including minors, that ‘all sales are final,'” Judge Freeman explained in her ruling.

The Facebook class action lawsuit was first filed in April 2012, alleging that the social media company violated the California Family Code, “which recognize that minors will occasionally use their lack of judgement to enter into contractual relationships and alter assert the right to walk away from the contract.”

The motion to certify the class in the Facebook class action lawsuit was filed in August 2014.

The plaintiffs are represented by C. Brooks Cutter and John R. Parker Jr. of Kershaw Cutter & Ratinoff LLP, Daniel B. Edelman of Katz Marshall & Banks LLP and Benjamin Edelman.

Facebook is represented by Michael G. Rhodes, Whitty Somvichian, Benjamin H. Kleine and Kristine Forderer of Cooley LLP.

The Facebook In-App Purchases Class Action Lawsuit is I.B., by and through Glynnis Bohannon et al. v. Facebook Inc., Case No. 5:12-cv-01894, in the U.S. District Court for the Northern District of California, San Jose Division.

UPDATE: On Jan. 15, 2016, the Facebook class action lawsuit reached a settlement in which the social network agreed to make things easier on parents who request refunds for in-app purchases unknowingly made by a minor, in addition to other procedural changes.

UPDATE 2: On Jan. 24, 2019, documents recently unsealed after legal action by The Center for Investigative Reporting show that Facebook bilked kids and parents out of money using in-app purchases and kept doing so even though an employee had discovered a fix.