As part of a settlement for a suit, Facebook will have to give its members more control over which actions can be promoted through Sponsored Stories.

Five members, two of whom are minors, filed a lawsuit against the social network for using their names and faces in ad units without their consent, a violation of California law.

According to court documents, Facebook agreed to create a way for members to view which interactions have been displayed in Sponsored Stories, and to take action to opt out of these being shown again.

However, this only applies to individual interactions or categories of interactions. It won’t turn off Sponsored Stories all together, unlike non-Sponsored Stories ads, which the company has allowed members to completely opt-out of since 2010.

TechCrunch’s Josh Constine explained it well: “For example, I like Automobile Brand X. I can opt out of being shown beside an ad that says ‘Buy Automobile Brand X’s new gas-guzzling EvilMobile’ because I never saw that ad creative. But I can’t opt out of a Sponsored Story that merely says ‘Josh Likes Automobile X’ because I did.”

It’s too early to tell what kind of impact (if at all) it will have on Facebook’s advertisers. Should a large percentage of its user base take advantage of the new controls, it’s possible that Sponsored Stories — which boast higher clickthrough rates than other Facbeook ads — could take a dive.

[Via: Inside Facebook, Image credit: o5com]