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Facebook settles biometric face-tagging suit for $550 million

Facebook settles biometric face-tagging suit for $550 million

Facebook Inc. executives have said they will pay $550 million to settle accusations that the social-media icon stole and then used subscribers’ biometric data — specifically, face geometries. It is being called the largest privacy-related settlement to date.

The announcement came as a surprise to many listening to Facebook’s fourth-quarter earnings call Wednesday evening. Plaintiffs in the five-year class-action case claimed that Facebook violated the state of Illinois’ 2008 Biometric Information Privacy Act (BIPA) by collecting the data.

Facebook maintains that it has done nothing wrong. Dave Wehner, the company’s chief financial officer, broke the news as he updated market analysts and journalists about the case during his quarterly financials telephone conference.

A company spokesperson later sent an email to reporters stating that executives wanted to put the case behind them in the interest of their shareholders and subscribers. Facebook shares fell almost 7 percent in the hours following the announcement Wednesday, according to MarketWatch.

Judge James Donato of the Ninth Circuit Court of Appeals, who has presided of the case from the outset, must review the proposed settlement and decide if it is appropriate.

Under the Illinois law, companies must obtain written consent from people before deploying facial recognition to collect face-geometry information. Businesses face a penalty of $5,000 per violation or actual damages, whichever is greater, according to the American Bar Association.

The list of companies being taken to court under the state law is growing. Any firm acquiring and using biometric data, in any industry, is a potential target, according to the bar association.

In fighting Patel v. Facebook, the executives with the social-media giant vigorously defended its photo-labeling service, called Tag Suggestions. It had vocal allies, too, some of whom filed friend-of-the court briefs as the case proceeded.

The Security Industry Association was one of several similar groups trying to persuade judges of face-recognition’s merit.

In December, the Washington Legal Foundation filed an amicus curiae brief with the U.S. Supreme Court, urging the justices to accept Facebook’s petition that they review a Ninth Circuit decision allowing the class-action suit to move forward. Last week the Court declined to hear Facebook’s appeal.

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