Clearview fights to give away 23% of facial recognition business

A U.S. district judge has heard arguments for and against approving the unusual settlement agreement struck in a biometric data privacy lawsuit between Clearview AI and plaintiffs last June. There is some doubt as to whether the settlement will be approved, MLex reports.

The agreement would grant plaintiffs a 23 percent stake in Clearview, one for each attorney general from 22 states and the District of Columbia who are opposing it. The AGs are acting as Amici in the case.

District Judge Sharon Johnson Coleman appears inclined to agree with points made on each side, according to MLex. Johnson noted during a Thursday hearing that “There has been a lot of work and a lot of effort by a lot of people — a lot of eyes on this.” She also expressed sympathy for those arguing that Clearview’s opt-out policy, which requires users to submit a facial photo to have their images removed from Clearview’s facial recognition database, is problematic.

“But you understand the concern,” she said. “They have to put their face into the system, to keep their face out of the system.”

Several people from the class told Johnson they do not want to accept equity from the company, arguing that an inventive to hope the company succeeds commercially contradicts their aims. Bankrupting Clearview would be preferable, they argue.

“Clearview plainly lacked and lacks sufficient funds for a meaningful settlement and was likely to be bankrupted by its costs of litigation alone,” plaintiffs wrote in filing quoted by MLex ahead of Thursday’s hearing.

Clearview Representative James Thompson described the company’s finances as those of a startup with revenue, but “not enough revenue to explode yet.”

A plaintiffs lawyer told Johnson that the 23 percent figure compares favorably to totals paid to settle Illinois Biometric Information Privacy Act (BIPA) claims by Google (0.1 percent of its value) and Meta (1 percent).

In contrast, 23 percent of Clearview, at an estimated $225 million valuation, would yield $31 million for the settlement class, once the attorneys and named plaintiffs have received their cut.

Vermont Assistant Attorney General Sarah Aceves says that state’s unsuccessful attempt to sue Clearview might not be its last.

Article Topics

Biometric Information Privacy Act (BIPA)  |  biometrics  |  Clearview AI  |  data privacy  |  facial recognition  |  lawsuits