Yahoo Inc. has agreed to make changes to its privacy policy and pay up to $4 million in fees as a settlement agreement to a class-action suit brought by non-users of the company's email services.
The plaintiffs contended that Yahoo violated their right to privacy for having their emails analyzed. According to them, while they do not use Yahoo's services the emails they sent to Yahoo users were subjected to automated scans to come up with targeted ads. Ars Technica noted that Yahoo allegedly violated their privacy since they "did not consent to Yahoo's interception and scanning of their emails."
According to RT, the issue was first raised in 2013, when Yahoo was blasted with six lawsuits that were later consolidated into a class action in federal court.
Court records indicate that Yahoo submitted settlement proposal to U.S. District Court Judge Lucy Koh on Thursday. Under the proposal, the internet giant will grant payment of attorneys' fees of up to $4 million.
According to SC Magazine, the amount in its entirety will go to the plaintiffs' counsel at Girard Gibbs and Kaplan Fox & Kilsheimer
The parties to the case, however, will not receive any monetary compensation from Yahoo.
In response to the core issue of the case, Yahoo has agreed to make modifications to its email scanning framework. But instead of complying with the plaintiffs' demands, Yahoo will make the necessary technical changes in their own terms, that is the company will continue to analyze emails for advertising purposes, but the contents of the emails will be "sent to servers for analysis... after a Yahoo Mail user can access the email in his or her inbox."
Yahoo further contends that it did not violate any privacy law, particularly the California Invasion of Privacy Act, since the company "does not read or learn the content of emails for advertising purposes until after the emails have been delivered."
Yahoo's settlement terms are different from what the plaintiffs are asking. Under their complaint, the parties sought an injunction that would enjoin Yahoo from doing anything without getting consent and further require the company to delete all information it has previously gathered through the automated scans.
Under California law, both sender and recipient are required to give consent before their electronic correspondence can be intercepted.
A spokesperson for Yahoo said, "Yahoo denies any wrongdoing and it notes that the Court has not issued any ruling that Yahoo acted unlawfully."
The settlement proposal is still subject to court approval before it can be entered into by the parties.
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