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Judge could upend how Web companies use data

The world’s biggest Web companies are lining up at the courtroom of a California federal judge whose rulings could further inflame the widening debate over online privacy and how the Internet giants use personal data.

Google, LinkedIn and Yahoo are all being sued by customers who say they unfairly appropriated personal information for profit. The lawsuits have landed before U.S. District Judge Lucy Koh in San Jose, who in September rattled Google – and became a hero to some privacy advocates – when she said the company wasn’t disclosing its plans for the user information clearly enough.

At issue is consent: Are users who check off on online companies’ click-to-agree screens, or have access to their privacy policies and opt-out buttons, given an explicit enough picture of providers’ plans?

The answer is no, according to plaintiffs in several complaints before Koh that threaten to upend how the companies monetize user data for an online advertising market that generated more than $40 billion in the U.S. last year. These people allege that even if they clicked an online agreement button, they didn’t agree to let them read their e-mails, use their photos or access their personal address books.

Judges have dismissed many such complaints, saying customers agreed to online contracts and hadn’t proved any harm. Koh, in overseeing cases against Google and Facebook, has broken from other courts by giving the fullest interpretations yet of when these companies may be acting without consent.

Koh and the three companies declined to comment on the legal proceedings.

Consumers are becoming aware of how online companies profit from personal information in ways they may not understand.

Concerns over data security have sharpened after Edward Snowden leaked information that Internet companies are being compelled under court orders to give the National Security Agency information about American and other users.

In the last 18 months more than 200 suits were filed nationwide in just one category – companies’ tracking of online activities –up from 10 in 2010, according to law firm Alston & Bird LLP.

Koh is one of five San Jose district judges ruling on cases that touch Silicon Valley. Her rulings, if they survive expected appeals, could have big implications for Web companies.

Google was expected to capture almost 40 percent of $42.6 billion in U.S. online ad money in 2013, research firm eMarketer reported in December. After runner-up Facebook, with 7.4 percent, Yahoo’s share was expected to be 5.8 percent.

In the complaint against LinkedIn, nine people accuse the professional networking site of scanning their online contact lists and using their names and photos without permission to lure new members. LinkedIn emailed repeat invitations to people they hadn’t wanted the messages to reach, including fellow board members, rival lawyers and old girlfriends, the plaintiffs said.

LinkedIn spokesman Hani Durzy said the company doesn’t access users’ address books or send emailed invitations without permission. LinkedIn, in asking Koh in December to dismiss the suit, said members consented to terms allowing the company to invite their contacts to the site.