As we reported in December 2010, several lawsuits were filed last year regarding companies' use of "flash cookies" to track website users' online behavior. Flash cookies, unlike typical browser cookies, cannot be deleted using browser tools, and often can regenerate after being deleted. The case we previously reported on, brought against Quantcast, Clearspring, and several of their well-known clients, settled for $2.4 million. Another case, brought against Specific Media, was dismissed in April. The court ruled that the plaintiffs in the Specific Media case had failed to allege sufficient injury or damage. The judge acknowledged flash cookies could cause plaintiffs economic injury, but concluded they had failed to sufficiently articulate their economic harm as a result of Specific Media's activity. The case was dismissed without prejudice and plaintiffs filed an amended complaint last month. The amended complaint specifically articulates the alleged harm plaintiffs suffered, arguing that plaintiffs' personal information is an economic asset to advertisers. The complaint also alleges defendant's practices slowed down their computer and Internet speeds, thereby depriving plaintiffs of a benefit for which they had paid.

TIP: Companies that host online websites – whether designed internally or by a third-party – should ensure that they fully understand what types of tracking tools are being used on their websites. If flash cookies are used, additional (prominent) disclosures may help avoid lawsuits like the ones mentioned here.