Yesterday, the Federal Trade Commission (FTC) announced that it is charging the operators of the so-called social-networking personal reputation site “Jerk.com” for engaging in deceptive representations in violation of the FTC Act. According to the FTC’s administrative complaint, Jerk.com and its owner, Napster cofounder John Fanning, misled consumers into believing that Jerk.com profiles, labeling people a “jerk” or “not a jerk,” were created by other users of the site, when in fact Jerk.com and Fanning created the vast majority of profiles by improperly harvesting information through one of Facebook’s application programming interfaces (APIs), and downloading names and photographs of Facebook users.

Facebook permits third-party developers to integrate websites and applications with Facebook. Developers are also permitted to access data for all Facebook users through Facebook’s APIs. Developers that use the Facebook platform, however, must agree to Facebook’s polices. The FTC contends that Jerk.com and Fanning used Facebook’s platform in violation of Facebook’s policy terms, which include:

  1. obtaining users’ explicit consent to share certain Facebook data;
  2. deleting user information obtained through Facebook once Facebook disables the developer’s access;
  3. providing an easily accessible mechanism for consumers to request the deletion of their Facebook data; and
  4. deleting information obtained from Facebook upon a consumer’s request.

The FTC also asserts that Jerk.com and Fanning falsely claimed that consumers could revise their online profiles by paying a $30 membership fee. The complaint alleges that, in numerous instances, consumers who paid the membership fee received nothing in exchange. Consumers were also charged a $25 fee to email Jerk.com’s customer service department, making it difficult for consumers to contact Jerk.com with complaints and take-down demands. The complaint charges Jerk.com and Fanning with two counts of deceptive acts or practices in violation of Section 5(a) of the FTC Act. The first count is for deceptive representations regarding the source of Jerk.com’s content, and the second count is for deceptive representations regarding Jerk.com’s membership. The FTC is seeking an order barring the defendants’ deceptive practices, prohibiting them from using the personal information they improperly obtained, and requiring them to delete the information.

As companies increasingly integrate their websites and applications with Facebook’s APIs, this case is a good reminder that organizations should review Facebook’s policies, and confirm their business practices are consistent with such policies.

Jalyce Mangum contributed to this post. Ms. Mangum is practicing under the supervision of principals of the firm who are members of the D.C. Bar.