Meta’s $1.4B settlement in Texas biometric data privacy lawsuit approved

Meta has agreed to pay $1.4 billion to the state of Texas to settle the lawsuit against it for using its discontinued facial recognition tag suggestions feature, and the settlement has been approved by the court.

The lawsuit was filed by Attorney General Ken Paxton under the Capture or Use of Biometric Identifier (CUBI) Act in 2022. Law firm McKool Smith also represented the state.

Meta has insisted that it was in compliance with CUBI, and that it was clear with users about the biometric feature the state says it did not receive consent for. The company also criticized Texas for overreaching its privacy law by seeking an injunction, and for filing its suit only after a California court approved a $650 million settlement of a biometric data privacy case under brought under Illinois’ BIPA.

“After vigorously pursuing justice for our citizens whose privacy rights were violated by Meta’s use of facial recognition software, I’m proud to announce that we have reached the largest settlement ever obtained from an action brought by a single State,” says Attorney General Paxton. “This historic settlement demonstrates our commitment to standing up to the world’s biggest technology companies and holding them accountable for breaking the law and violating Texans’ privacy rights.”

The state and the social media giant had been locked in a dispute over a demand that CEO Mark Zuckerberg sit for deposition, but froze the case with a provisional settlement at the end of May.

Now, Meta will pay the first $500 million instalment on its settlement amount within 30 days, with the remainder payable by 2028.

Both parties relinquish all claims under the agreement, which also sets out the terms for consultations between Meta and state authorities on compliance with Texas’ biometrics law.

Major implications for biometrics providers

The settlement has major implications for biometrics providers and policy-makers, says Baker Donelson Of Counsel David J. Oberly.

“The $1.4 million settlement reached between Meta and the State of Texas to resolve claims that Meta violated CUBI is a watershed moment in the area of biometrics for several reasons. First, the Meta settlement figure itself represents far and away the largest settlement to date for alleged biometrics legal non-compliance,” Oberly tells Biometric Update in an email.

“More than that, the Meta settlement illustrates the outsized legal risks and liability exposure that companies face in connection with the growing patchwork of biometrics laws that currently exist around the country. Until now, CUBI has largely flown under the radar, which can be attributed predominantly to the fact that civil penalties are the exclusive remedy available for non-compliance with the Texas law. No longer will that be the case, as Meta’s eye-popping settlement—and the clear and unequivocal warning that it provides regarding the tremendous monetary and reputational risks that companies face for failing to align their compliance programs with Texas’s biometrics statute—will put CUBI front and center on the minds and agendas of in-house legal teams and corporate executives across all industries, especially given that penalties of up to $25,000 can be imposed per each instance of non-compliance.”

Lawmakers at the federal, state and municipal levels will also be motivated to push pending biometrics legislation over the finish line, he says.

The settlement follows a series of other high-profile biometric data protection lawsuits resolved out of court this year, including by Clearview AI, Tesla and BNSF Railway.

Article Topics

biometric data  |  biometric identifiers  |  CUBI  |  data privacy  |  data protection  |  David Oberly  |  facial recognition  |  lawsuits  |  Meta  |  social media  |  Texas