DAVENPORT, Iowa — Subscribers to the Winona Daily News and other Lee Enterprises news sites are eligible for $41 checks for a dubious scheme to target advertising anonymously to subscribers. The court-ordered payments, totaling $9.5 million, resulted from a class-action lawsuit. Eligible are online Lee subscribers going back 4-1/2 years. Advertising was sent unsolicited to an estimated 1.5 million subscribers. The settlement has serious financial implications for Lee. The Iowa-based company has been in trouble for years with circulation and advertising losses. Lee is $450 million in debt, largely from ill-timed acquisitions of other newspapers in 2005. The chain owns 77 newspapers that it claims are dailies but that have been trimmed to three days a week.
Earlier: Lee fixes digital wreck left by hackers
Why Lee settled
Lee installed an invisible online tracker from social media giant Meta-Facebook to target advertising. This, according to a class-action suit, was a violation of federal law that requires privacy protection. The software was designed to build profiles secretly of Lee subscribers “with the hope of improving the effectiveness of advertising targeting those users,” according to the class-action suit. Lee claims it did nothing wrong but chose to settle the dispute rather spend years and millions of dollars to fight it out. Fact: Other companies that used such tracking tools have been found liable for disclosing personal information.