Photo:  Sean MacEntee /Flickr A federal judge, ruling late Friday he had “serious concerns,” rejected a Facebook privacy settlement concerning the social networking site’s “Sponsored Stories” advertising program. U.S. District Judge Richard Seeborg of San Francisco was concerned that the deal, which provides a $10 million payout to attorneys suing Facebook and $10 million to charity in what is known as a cy pres award “was merely plucked from thin air.” At a hearing two weeks ago in San Francisco federal court, Seeborg asked why the payout to charity shouldn’t be $100 million. As he said then and in his Friday ruling, he ordered the parties to provide more information on how it reached that amount. He was concerned that Facebook said the deal might cost them $100 million in advertising revenues, but only $20 million in a payout. And that doesn’t calculate the amount of damages for the 100 million Facebook users who have already appeared in Sponsored Stories, he said. Those amounts, the judge ruled, makes it seem like Facebook users are getting shafted by the lawyers suppposedly representing them in a fight against Facebook’s use of their profile photos in advertisements.

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Judge Rejects Facebook ‘Sponsored Stories’ Lawsuit Settlement