Clearview takes fresh legal hits over Canada class action, UK fine

Few biometrics companies have taken a bigger regulatory and legal beating than Clearview AI. It has already been a rough year for the firm, which in April ousted its founder and CEO, Hoan Ton That. In May, Clearview finally settled a five-year-long biometric data privacy lawsuit in the U.S., which gave plaintiffs a 23 percent equity stake in the company, to be triggered by an IPO or a liquidation event. Estimates put the value of the settlement at around $51.75 million. More litigation in the U.S. may be forthcoming.

A new blow comes from Canada, where, according to Law360 Canada, the Federal Court of Appeal has revived a proposed class action against the facial recognition firm.

Clearview operated in Canada from 2019 to July 2020, notably providing facial recognition to the country’s federal police force, the RCMP. The firm suspended its services in the country after the class action was filed with the Federal Court of Canada on July 8, and in response to critical recommendations from the Office of the Privacy Commissioner over potential privacy violations in its collection of face biometrics.

Five years and a week later, on July 16, Justice Elizabeth Walker rejected the firm’s legal arguments against the class action, which center on the “opt-out” nature of Canadian class actions. Under Canadian law, most class actions automatically include members who meet criteria outlined in a certification order. Those who wish to be excluded must opt out.

Clearview says that in its case, query-based class identification – i.e., requiring potential class members to query the company to confirm their inclusion – undermines this opt-out scheme, in effect making it opt-in.

Walker’s ruling says that’s not so.

“The fact there will almost inevitably be Class Members who do not engage with the process does not result in an opt-in process, nor does it thwart the objective of the class action regime in promoting access to justice,” says the judge’s statement. “The Class Member remains part of the class and could, if they so wish, take steps to opt out. They remain unengaged at their own risk.”

“If a person does nothing, they remain a Class Member assuming they later prove they are a Class Member. Similarly, an individual who is unsure whether they are or are not a Class Member and who submits a query to Clearview remains a Class Member unless they choose to opt out, again assuming they later prove they are a Class Member.”

The proposed class was defined by the appellant as “including all Canadian residents or citizens who are authors of photographs collected by Clearview AI and who have not assigned or licensed their copyrights, as well as individuals or entities to whom those copyrights had been assigned or licensed.” That means anyone whose face biometrics ended up in Clearview’s database could be eligible.

A previous court decision deemed this so broad as to be too vague, in that it “failed to meet the certification requirement of an identifiable class of two or more persons.” A certification judge found that “class members could not self-identify on the basis of the class definition and that the defendant could not identify class members based on metadata in its database.”

An appeal argued that the certification judge was wrong in finding that a query-based process would turn opt-out into opt-in.

Justice Walker’s finding now says that class members choosing to confirm their status via a query to Clearview does not change the characterization of the proceeding as an opt-out scheme.

There is likely to be more legal back and forth, as Clearview tries to avoid further beatdowns.

Off-again, on-again UK fine ‘completely unprincipled’

As it fends off Canadian legislators with one hand, Clearview is using the other to defend itself in UK courtrooms. It is currently fighting the reinstatement of a fine of 7.5 million pounds (US$10 million), arguing that its operations as a “data controller” fall outside the scope of the UK GDPR, since it doesn’t monitor user behavior.

A report from MLex says that in court, Clearview “attacked the UK data privacy regulator’s court arguments as to why a multimillion-pound fine imposed on the facial-recognition technologist and later annulled by judges should be reinstated.” It calls the Information Commissioner’s Office (ICO)’s legal foundation for an appeal on its suspension “completely unprincipled.”

As is the case in Canada, a previous legal decision killed the proposed fine, when a three-member tribunal ruled that the ICO was not authorized to impose it under the UK GDPR.

However, judges in the current case appear unconvinced that the firm falls outside the scope of the regulation, based on its own testimony.

At this point, with a trail of fines in its wake – in Italy (which has been chasing a 20 million euro, or US$22.8 million fine levied by its data regulator in 2022), Greece, France and the Netherlands, to name a few – Clearview is as synonymous with compliance violations and legal trouble as it is with the facial recognition services it offers to law enforcement. Whether or not that’s a concern for its owners and leaders is an open question. Even the toughest fighters will go down after one too many shots to the head.

Nonetheless, having ditched its founder and proposed a “new direction” that reportedly involved pursuing contracts with the Trump administration, Clearview battles on, offering a fresh face for every new uppercut.

Article Topics

biometrics  |  Canada  |  Clearview AI  |  facial recognition  |  lawsuits  |  UK