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A biometric data privacy win in court is followed by a related FTC investigation and lawsuit

A biometric data privacy win in court is followed by a related FTC investigation and lawsuit
 

Executives at facial recognition firm Clarifai may have sighed with relief in March 2021 when a judge agreed that they could not be sued for violating Illinois’ biometric privacy law, but then the federal government came knocking.

The Federal Trade Commission now wants to know how the face image that a woman posted on the OkCupid dating site ended up being used as training data by Clarifai without her consent or disclosing the transaction as required by Illinois’ Biometric Information Privacy Act.

Clarifai makes computer vision, deep learning AI and biometrics systems.

Claiming that its investigation is being stonewalled by Match Group, owner of OkCupid, the FTC has filed suit (case number 1:22-mc-00054), according to Bloomberg Law.

The government claims that OkCupid engaged in unfair and deceptive conduct by sharing biometric data with Clarifai in 2014.

Clarifai is not a defendant, but it is hard to imagine a judgment in favor of the FTC will ultimately be positive for the company. And, of course, a finding for the government could have wider impact on U.S. businesses.

(Also in March, Clarifai joined the Data Ethics Consortium for Security.)

“Match produced some documents during the course of the FTC’s investigation,” the lawsuit states, “but has withheld nearly every responsive internal communication based on improper and overbroad assertions of attorney-client privilege and the work product doctrine.”

That doctrine protects information gathered in anticipation from being viewed by opposing lawyers.

In the case that spurred this one, Illinois resident Jordan Stein attempted a class action against Clarifai after she learned that her OkCupid profile was shared by OkCupid with Clarifai. The suit was heard in the Northern District Court of Illinois.

The judge dismissed Stein’s case without prejudice because the court lacked jurisdiction. It was found that Clarifai, among other reasons, had not targeted its actions at Illinois residents.

Analysis for the decision, by The National Law Review and Bloomberg Law, can be found here and here, respectively.

The FTC seems to be following the path that regulation observers anticipated since at least the beginning of the year, namely, opening a new area of federal preemption of BIPA claims.

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