Google and Facebook's new tactic in the tech wars

If the Electronic Frontier Foundation, the nation's preeminent digital rights nonprofit, had disclosed last year that it received a cool $1 million gift from Google -- about 17% of its total revenue -- some eyebrows might have been raised.

The group typically describes itself as "member-supported" and, like most nonprofits, it treasures its above-the-commercial-fray, public-interest-group aura and reputation for independence. In fact, Google did transfer $1 million to the EFF last year, but the money did not have to be, and wasn't, reported as a corporate donation. And if, as currently planned, the EFF receives another $1 million this year from Facebook, it won't have to report that as a donation either. That's because both transfers are formally court-ordered outlays being paid by those companies to settle class-action suits. "Well, of course those aren't donations!" the reader might interject. "They're the diametric opposite: involuntary, judicially mandated payments forced upon them by an adversary!" That's not the whole story either. These payments to the EFF are being made in suits the EFF played no role in bringing, and the defendants themselves -- Google and Facebook, in these instances -- helped select EFF to be their beneficiary.