It seems like Facebook is getting battered a lot these days, but I’ll give the folks at Facebook some credit.  Most companies, faced with a lawsuit – especially one that claims you are violating the Civil Rights Act and excluding minorities from opportunities – would lawyer up and shut up.

Facebook is taking a little different approach:  making change.

“We take these issues seriously. Discriminatory advertising has no place on Facebook.” – Erin Egan, VP, US Public Policy and Chief Privacy Officer, Facebook

The Lawsuit

Three people  filed a class action lawsuit claiming they looked at Facebook for housing and jobs and that the ad targeting options Facebook allows violate the Fair Housing Act and the Civil Rights Act of 1964 (Mediapost).

“Facebook has operated and is operating an advertising platform … that publishes, and causes to be published, discriminatory and illegal housing and employment advertisements… By clicking on a button labeled ‘Exclude People,’ ad buyers … can prevent their ads from being displayed to users matching characteristics such as ‘African American (US),’ ‘Asian American (US),’ or ‘Immigrant.’” – Class-action complaint filed in U.S. District Court for the Northern District of California

The Change

Here’s what Facebook is doing.  “Going forward, we have decided to make the following changes to our advertising products,” wrote Erin Egan, VP, US Public Policy and Chief Privacy Officer, Facebook  on its news blog, announcing the following changes.

• Build tools to detect and automatically disable the use of ethnic affinity marketing for certain types of ads: We will disable the use of ethnic affinity marketing for ads that we identify as offering housing, employment, or credit. There are many non-discriminatory uses of our ethnic affinity solution in these areas, but we have decided that we can best guard against discrimination by suspending these types of ads. We will continue to explore ways that our ethnic affinity solution can be used to promote inclusion of underrepresented communities, and we will continue to work with stakeholders toward that goal.
• Offer more clarification and education: We will update our Advertising Policiesto be even more explicit and require advertisers to affirm that they will not engage in discriminatory advertising on Facebook, and we will offer new educational materials to help advertisers understand their obligations with respect to housing, employment and credit.

The background

Facebook ads lets you exclude users from ads based on race – at least it did before this announced change.

When you’re as big as Facebook is, everything you do is going to be under the microscope — from what stories you feature in the Trending section, to what pictures you allow to be published, to how you count video views, to the nuances of just about every word your Founder says.

As the uncredited narrator in August 1962 edition of the comic book, Amazing Fantasy, said in introducing the world to Spiderman: “with great power there must also come–great responsibility!”

Enter the non-profit, independant newsroom that produces investigative journalism, Pro Publica. In its latest investigation, it shows how Facebook allows you to exclude minority groups from targeted ads.

“Imagine if, during the Jim Crow era, a newspaper offered advertisers the option of placing ads only in copies that went to white readers. That’s basically what Facebook is doing nowadays.” — Julia Angwin & Terry Parris Jr., Pro Publica

Pro Publica noticed this: You can advertise to groups on Facebook and specifically exclude Ethnic Affinities, as Facebook calls it.

So, the group bought a Facebook ad for housing and excluded anyone with an “affinity” for African-American, Asian-Americans, or Hispanics.

Here’s the ad they created.

Civil Rights Lawyer: “This is horrifying. This is massively illegal.”

When we showed Facebook’s racial exclusion options to a prominent civil rights lawyer John Relman, he gasped and said, “This is horrifying. This is massively illegal. This is about as blatant a violation of the federal Fair Housing Act as one can find.” — Pro Publica

Sec 804. [42 USC 3604] of the Fair Housing Act

Sec 804. [42 USC 3604] of the Fair Housing Act makes it illegal to refuse to sell or rent… because of race, color, religion, sex, or national origin. Further, it’s illegal “To make, print, or publish, or cause to be made, printed, or published any notice, statement, or advertisement, with respect to the sale or rental of a dwelling that indicates any preference, limitation, or discrimination based on race, color, religion, sex, handicap, familial status, or national origin, or an intention to make any such preference, limitation, or discrimination.”

Pro Publica placed the ad used the DIY model, its self-service ad portal. Facebook, for its part, told Pro Publica that its policy prohibits advertisers from using targeting option for discrimination.

“We take a strong stand against advertisers misusing our platform: Our policies prohibit using our targeting options to discriminate, and they require compliance with the law. We take prompt enforcement action when we determine that ads violate our policies.” — Steve Satterfield, privacy and public policy manager at Facebook, as quoted by Pro Publica

Despite those words, the ad was approved. In 15 minutes. Pro Publica said Facebook declined to discuss that.

Interesting to note is that you can’t exclude white groups from the list, only non-whites.

Christian Martinez, Head of Multicultural at Facebook, wrote that there are reasons Facebook offers these options.

“Advertisers may also focus on reaching any group directly. For example, a nonprofit that’s hosting a career fair for the Hispanic community can use Facebook ads to reach people who have an interest in that community,” said Martinez. “And a merchant selling hair care products that are designed for black women can reach people who are most likely to want its products.

That merchant also may want to exclude other ethnicities for whom their hair care products are not relevant — this is a process known in the ad industry as ‘exclusion targeting.’ This prevents audiences for community-specific ads from seeing a generic ad targeted to a large group and helps avoid the offensive outcome that traditional advertising can often create for people in the minority.” — Christian Martinez, Head of Multicultural at Facebook