• Pin Money. Brands of all sizes have long used the virtual pin board/social media site Pinterest to promote their wares and drive traffic to their web sites. Beginning in October 2014, companies will be able to purchase paid advertisements on the site as well. Pinterest announced plans to make “Promoted Pins” available to more than just the handful of big brands that have been helping the company to test its ad product since last fall. The company expects to ultimately offer advertisers pay-per-click arrangements like the ones available to purchasers of Google’s sponsored search results, and is amending its privacy policy to state, among other things, that Pinterest may collect information about its users from its advertisers and in connection with its advertisers’ websites and apps.
  • Benched judge. Michael Maggio, a state trial judge in Arkansas, was removed from the bench by the state’s highest court after he acknowledged posting confidential details about court cases in social media outlets. The judge was handling a closed adoption involving actress Charlize Theron, and he admitted posting private facts about the case. After a report by a state judicial-discipline commission, he was removed from the bench and prohibited from handling any judicial office in the future. He was found to have violated at least 23 strictures that apply to sitting judges.
  • Sweet tweets. According to a study conducted by Twitter, the Twitter accounts of members of casts of television shows get a 228 percent increase in followers if the actors live-tweet their shows. This follows other studies that indicate that TV ratings can go up as a result of live-tweeting. Grey’s Anatomy and Scandal, both originated by Shonda Rhimes, are among the shows that have gotten major boosts from the social network.
  • Going mainstream. For the first time, both Twitter and Facebook are seeing significant growth in online advertising placed by major companies for brands such as Heineken, Tide, McDonald’s, and Charmin. Major consumer products companies have long struggled with the question of how to reach consumers on their mobile devices, and right now, this appears to be how they’re doing it.
  • Mismatch? The popular dating site OKCupid conducted some experiments with its user base — changing the type of information available to them about prospective matches and even falsifying it to an extent — in order to see what effect it had on conversations among daters and on how relationships developed. Some observers are critical of this type of experiment on ethical grounds.
  • Loose tweets sink ships? Law enforcement agencies in the Pacific Northwest have launched a “Tweet Smart” program that is intended to discourage people from using social media during emergencies to describe the movements and activities of law enforcement personnel. After a few recent shooting incidents, police are concerned that a tweet, for example, might tip off a perpetrator to police tactics.
  • Judges’ perspective. A recent survey of federal judges found that the vast majority of them do not believe that jurors’ use of social media has posed a problem in their courtrooms. Only 33 of 494 judges responding reported any detectable instances of jurors using social media, and the vast majority of those instances were harmless.
  • Going viral: Silencing its critics, Twitter posted strong second quarter results, adding 16 million new monthly active users and boosting its user base by 24 percent from this time last year.
  • #Disappointing: In other Twitter news, the company recently revealed data about the composition of its workforce. It turns out that 90 percent of tech staff and 70 percent of all staff are men, and men make up 79 percent of its leadership. Only 2 percent of the staff is African American, and Latinos make up 3 percent. Its VP for diversity said that like similar companies, Twitter “has a lot of work to do” in this area.
  • Balancing act: Reddit has always been a niche social network that never embraced advertising as a source of revenue. That apparently will change now, as Reddit, which is majority-owned by Conde Nast,  is trying to attract advertisers without losing its unique culture.
  • Busted: A Maryland man taunted local police by posting on the police Facebook page (under his own mugshot) that the cops would never catch him—but the police caught him for a probation violation the next day, primarily by using Facebook.
  • Twitter is rolling out a new type of advertising that reportedly has been very successful for Facebook’s mobile business — mobile-app install ads, which link directly to games and other apps in popular mobile app stores.
  • An Idaho state court affirmed the Idaho Industrial Commission’s denial of unemployment benefits to a nurse who was discharged after posting on Facebook about “a patient who is just being a jerk,” in violation of his employer’s Social and Electronic Media Conduct Policy.
  • According to a study conducted for the Association of National Advertisers, most brands are now using metrics to measure social media effectiveness. That said, “soft” metrics such as “likes” and clickthroughs are being used far more commonly than more sophisticated measures such as ROI and sales.

The Federal Trade Commission (FTC) has cracked down on a company that was engaged in “history sniffing,” a means of online tracking that digs up information embedded in web browsers to reveal the websites that users have visited. In a proposed settlement with Epic Marketplace, Inc. and Epic Media Group (together, “EMG”) announced on December 5, 2012, the FTC settled charges that EMG had improperly used history sniffing to collect sensitive information regarding unsuspecting consumers. 

EMG functions as an intermediary between publishers—i.e., websites that publish ads—and the advertisers who want to place their ads on those websites. It does this through online behavioral advertising, which typically entails placing cookies on websites a consumer visits in order to collect information about his or her use of the website and then using that information to serve targeted ads to the user when he or she visits other websites within the EMG Marketplace Network.

What got EMG into trouble was that it also used history sniffing to collect information regarding the websites that users visited. Here’s how the technique works. In your web browser, hyperlinks to websites change color once you have visited them. After you have visited a webpage, the hyperlink to it will most likely appear in one color (e.g., purple). If you haven’t been to a particular webpage before, any link to it will probably show up in another color (e.g., blue). History sniffing code exploits this feature to go through your browser—that is, to “sniff” around—to see what color your hyperlinks are. When the code finds purple links, it knows that you’ve been to those websites.

According to the FTC, for almost 18 months—from March 2010 until August 2011—EMG included history sniffing code in ads it served to website visitors on at least 24,000 webpages within its network, including webpages associated with name brand websites. EMG used the code to determine whether consumers had visited more than 54,000 different domains, including websites “relating to fertility issues, impotence, menopause, incontinence, disability insurance, credit repair, debt relief, and personal bankruptcy.” EMG used this sensitive information to sort consumers into “interest segments” that, in turn, included sensitive categories like “Incontinence,” “Arthritis,” “Memory Improvement,” and “Pregnancy-Fertility Getting Pregnant.” EMG then used the sensitive interest segments to deliver targeted ads to consumers.

History sniffing is not per se illegal under U.S. law. What got EMG in trouble was that it allegedly misrepresented how it tracked consumers. First, EMG’s privacy policy at the time stated that the company only collected information about visits to websites within the EMG network; however, the FTC alleged that the history sniffing code enabled EMG to “determine whether consumers had visited webpages that were outside the [EMG] Marketplace Network, information it would not otherwise have been able to obtain.” EMG’s tracking of users in a manner inconsistent with its privacy policy was therefore allegedly deceptive, in violation of Section 5 of the FTC Act.

Second, EMG’s privacy policy did not disclose that the company was engaged in history sniffing; it disclosed only that it “receives and records anonymous information that your browser sends whenever you visit a website which is part of the [EMG] Marketplace Network.” According to the FTC, the fact that the company engaged in history sniffing would have been material to consumers in deciding whether to use EMG’s opt-out mechanism. EMG’s failure to disclose the practice was therefore also allegedly deceptive in violation of Section 5 of the FTC Act.

The proposed consent order would, among other things, require EMG to destroy all the information that it collected using history sniffing, bar it from collecting any data through history sniffing, prohibit it from using or disclosing any information that was collected through history sniffing, and bar misrepresentations regarding how the company collects and uses data from consumers or about its use of history sniffing code.

EMG stopped its history sniffing in August 2011, and most new versions of web browsers have technology that blocks this practice. Nonetheless, the FTC made it clear in the complaint that it wanted to highlight the problem because history sniffing “circumvents the most common and widely known method consumers use to prevent online tracking: deleting cookies.” Mark Eichorn, assistant director of the FTC’s Division of Privacy and Identity Protection, told the Los Angeles Times that the FTC “really wanted to make a statement with this case.” He added, “People, I think, really didn’t know that this was going on and didn’t have any reason to know.” The proposed consent order puts online tracking and advertising companies on notice: If you collect data in a manner inconsistent with—or not disclosed in—your privacy policy, you run the risk of a charge of deception.

Google’s recent announcement that it is preparing to offer behaviorally targeted ads for mobile devices has led to concerns regarding the tracking required to implement such functionality.  Online behavioral advertising has typically been implemented using cookies placed through a user’s web browser when the user visits a website.  Mobile devices, however, often access the Internet through applications that run outside of web browsers and do not support cookies.  This has left web hosts, advertisers, and those that sell advertising to find other ways to track online user behavior.  Google intends to tie users’ in-app behavior to their mobile devices’ unique “device identifiers,” potentially raising privacy concerns.

Google has sought to allay these privacy concerns through two mechanisms:  (1) it anonymizes user device information and allows users to reset the anonymous ID associated with their devices, and (2) it allows users to opt out of device tracking.  Google’s privacy policy, as updated on April 15, 2011, states that Google “uses anonymous IDs to serve ads in applications and other clients that do not support cookie technology.  When [a user] use[s] an application or other client,the application or other client may send device information to [Google].  [Google] anonymize[s] that device information by associating [the user’s] device ID with a random, anonymous string of characters.” Google uses the information received via the anonymous device IDs in the same ways that it uses AdSense information gathered through cookies.

Google’s announcement regarding mobile device tracking comes amidst growing scrutiny related to Internet tracking and privacy.  For example, in April 2011, Senators John Kerry (D., Mass.) and John McCain (R., Ariz.) proposed legislation setting forth “fair information practice principles” that would set minimum standards regarding the acceptability of information collection.  More recently, Senator Jay Rockefeller (D., W. Va.) went a step further, proposing an affirmative obligation for companies to not track people who click a browser flag indicating that they do not want to be tracked.  Additionally, Google’s new policy shortly preceded a lawsuit filed against it in federal court in Michigan alleging, among other things, that Google “d[id] not disclose its comprehensive tracking of users nor its use of a unique device ID attached to each specific phone” in its Terms of Service.