Instagram on Thursday rolled back the most controversial clause in its proposed terms of service, and National Geographic, for one, was satisfied by the change, announcing Friday that it would resume posting on the site. But the storm isn't over yet.
A San Diego-based law firm said Friday that it has filed a class-action lawsuit against the Facebook-owned photo-sharing service, seeking an injunction to prevent the new terms from going into effect. William Restis of the firm Finkelstein & Krinsk LLP told me he filed the complaint in U.S. District Court in San Francisco on Friday on behalf of Instagram user Lucy Funes.
A copy of the complaint shows the plaintiffs alleging that Instagram's new terms amount to breach of contract, unfair business practices, and violation of California business codes. Restis told me the suit won't be slowed by the company's backtrack this week on a much-hyped clause that specified how advertisers could display users' photos in promoted posts on the site. Instead, he zeroed in on a different sentence, which I highlighted in a post about the changes earlier this week. That clause gives the company a "transferable, sub-licensable" license to use your content, as opposed to the "limited" license outlined in Instagram's current policies. That phrasing is common to several other big social-media sites, but new to Instagram.
Restis told me he believes it amounts to an unlawful taking of users' property rights, particularly when coupled with several other new stipulations that limit Instagram's legal liability. For instance, under the new terms, users would waive their right to file class-action lawsuits—which is precisely why Restis said Funes filed this one today. He called the new policies "a smash and grab" by Facebook and Instagram that breaks "new ground on how companies can take valuable property rights from their customers while making sure those customers can't do anything about it."
Whether the case has legal merit, I can't say. But now that Instagram's new policies have been tried in the court of opinion, it would be interesting to see them tried in a court of law.
Instagram representatives could not be reached for comment Friday evening.
Update, Sunday, Dec. 23, 4:30 p.m.: A Facebook spokesman said of the lawsuit, "We believe this complaint is without merit and we will fight it vigorously."