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Out in Ontario, some students are suing Facebook for privacy infringement. The (non-legal) synopsis of the argument is that Facebook is granting full access to private and protected information to third parties without permission.
Facebook's response is:
"We've reviewed the complaint and found it has serious factual errors - most notably its neglect of the fact that almost all Facebook data is willingly shared by users," Facebook chief privacy officer Chris Kelly said Friday in an e-mail.
[...]
Canadian law mandates that sensitive information such as a person's address, sexual preference, birth date and school, can't be disclosed without gaining express consent. On Facebook, users must specifically change their settings to keep that information private.
It's the old opt-out versus opt-in issue. Businesses prefer that they have all the cards; customers expect that data should be kept private unless permission is explicitly granted for portions of it not to be.
The problem is exacerbated in that a large portion of Facebook's utility is via the third party plugins. The default for pretty much all of them is to grant the developer full access to all of one's private information. Refuse to give them that, and that functionality isn't available. That the information may be unused by the developer or may be entirely irrelevant to the purpose of the application is not considered.
I sympathise with the students but based on what I've read, Facebook is covered. It's a crappy business plan though and one that the company should resolve.