UPDATE 1-Google foe won't take 'no' on Buzz cash

Fri Apr 1, 2011 4:20am BST

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* Group fueling Google FTC probe left out of lawsuit deal

* Privacy group objects to Buzz class action settlement

* Group had asked for $1.75 million

(Adds procedural details about legal process)

By Dan Levine

SAN FRANCISCO, March 31 (Reuters) - An internet privacy group that prodded U.S. regulators to scrutinize Google Inc is miffed about getting cut out of a class action settlement over the search behemoth's Buzz social network.

The Electronic Privacy Information Center (EPIC) objected to the settlement in a court filing this week, claiming Google and others decided to fund groups already benefiting from the company's largesse.

EPIC, led by prominent privacy advocate Marc Rotenberg, filed a complaint with the Federal Trade Commission last year, saying Buzz threatened the privacy of Gmail users. Google settled with the FTC on Wednesday and agreed to independent privacy audits. [ID:nN30140907]

Google also agreed last year to resolve a separate class action lawsuit brought by a Gmail user. Part of that deal provided for more than $6 million to be distributed to groups advocating for internet privacy issues.

EPIC requested $1.75 million and while Google and plaintiff lawyers doled out money to groups like the American Civil Liberties Union, the Electronic Frontier Foundation and the Brookings Institution, EPIC did not get a cent. A federal judge will have to sign off on the disbursement plan.

EPIC and a handful of other groups objected in a court filing Wednesday, saying the majority of funds would be allocated to groups that "receive support from Google for lobbying, consulting, or similar services."

However, EPIC did not specify which of the groups provided lobbying services. Rotenberg declined to comment.

A Google representative also declined to comment, while plaintiff lawyers could not be reached.

The court should reject a deal "that encourages organizations to stand by quietly while others do the actual work of safeguarding internet privacy," EPIC said in its filing.

The case in U.S. District Court, Northern District of California is In Re Google Buzz User Privacy Litigation, 10-672. (Reporting by Dan Levine; Editing by Richard Chang and Matt Driskill)

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