Class-action lawsuits could hit Facebook, MySpace, others on scam offers

offerpal-1Lawyers are investigating whether to file class-action lawsuits based on the recent scandal over scam-like offers that have appeared in games and other apps on social networks.

Sacramento-based law firm Kershaw, Cutter & Ratinoff has begun investigating complaints about unauthorized charges that resulted from social network users being duped into accepting scam offers, Gawker reported. The law firm is looking at users of Facebook, MySpace, Zynga, RockYou, Offerpal Media, and Super Rewards, among others.

Following the commotion over offers in the past couple of weeks, the offer and social apps industry has already moved to end offer practices that led to billing complaints from consumers. Facebook temporarily suspended one of Zynga’s new games, FishVille, for example, because it violated the network’s new guidelines on advertising offers. Zynga responded by pulling the offers out of its games. Now the question is whether the companies will be liable for damages to consumers.

But it’s unclear how big the damages will be. Offerpal said that less than 1 percent of its offers generated complaints of any kind, though that was a statement by its now former chief executive, Anu Shukla (pictured, above right). The company’s new CEO, George Garrick, has said that Offerpal’s business wasn’t as clean as it had thought. Zynga’s CEO, Mark Pincus, was also filmed months back saying his company did “every horrible thing” to get users. Companies like RockYou, MySpace, Facebook and others have either reiterated or instituted a zero tolerance stance on scam offers. These are the sorts of admissions that class-action lawyers love.

[Photo by Alexa Lee]

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About the Author, Dean Takahashi

Dean is lead writer for GamesBeat at VentureBeat. He covers video games, security, chips and a variety of other subjects. Dean previously worked at the San Jose Mercury News, the Wall Street Journal, the Red Herring, the Los Angeles Times, the Orange County Register and the Dallas Times Herald. He is the author of two books, Opening the Xbox and the Xbox 360 Uncloaked. Follow him on Twitter at @deantak, and follow VentureBeat on Twitter at @venturebeat.

  • blog czar
    to think the myspace ceo was pounding his chest the other day - http://www.myspace.com/pressroom?url=/article_d...
  • Kenneth
    People need to be held accountable for these horrible business practices. I don't understand how people could get away with this: http://tinyurl.com/y8ltqg7
  • John
    CPA ads are used on almost every internet site that has advertising. I would wager 80-90% of ad-supported websites out there have run ads that would be termed 'scammy' at one point or another. Even Google's AdSense service runs questionable content (keep an eye out and you'll see such AdSense offers as the secret to making tens of thousands of dollars a week from your home...working part time!)

    8 years ago, when I worked on ad optimization at a company that's now part of Fox News Corp, the primary concern of the execs was to make sure we were running ads that made the most money, not those that were good for the user.
  • abercrombie0
    Everything will be all right,I am behind you.That’s something,That's what I was thinking.Brilliant idea.iphone club
  • I can’t wait to find out the results of this and as an iphone 3g owner inflicted w/ this problem I will be signing up too and if a fund is started I have some extra g’s to toss their way. I am simply sick and tired of this shat and its time a lot of people grow a spine and some dignity and stop taking up A’ at every turn they can get. You are a free human being with free will.
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