Facebook Agrees To Pay $650 Million As Part Of Lawsuit Over Facial Recognition Technology

KEY POINTS

Three Illinois residents sued Facebook in 2015 for allegedly violating the state's Biometric Information Privacy Act, which requires written consent before company's collect face scan data
A federal judge threw out the original proposed settlement of $550 million in June, questioning if it was a satisfactory amount for the case
Both parties have reportedly agreed to the new settlement and are awaing the judge's approval

Facebook has agreed to pay $650 million as part of its settlement for a lawsuit surrounding the company’s facial recognition technology and alleged privacy violations committed by the social media giant. The lawsuit was filed in 2015 by three Illinois residents who alleged Facebook violated their privacy under state law.

“We are focused on settling as it is in the best interest of our community and our shareholders to move past this matter,” Facebook said in a press release.

Both sides have reportedly agreed to the settlement and are awaiting the judge’s approval.

The lawsuit revolved around Facebook’s built-in face scan feature, which scans uploaded user pictures to identify people in the picture and make friend or group recommendations. However, the Illinois residents argued that Facebook scanned and collected their faces without written consent. This would violate Illinois’ Biometric Information Privacy Act, which requires written consent before any type of data can be collected.

Facebook’s new settlement is $100 million more than the previous $550 million proposed settlement Facebook offered in January. However, that settlement was thrown out in June by U.S. District Judge James Donato, who was overseeing the case in California and questioned Facebook’s offer.

“It's $550 million. That's a lot,” Donato said in court on June 4. “But the question is, is it really a lot?

“They are taking what is effectively a 98.75 percent discount off of the amount that the Illinois legislature said might be due in this case if you proved up your case.”

Facebook’s attorney Michael Rhodes argued this at the time and insisted the plaintiffs may receive more than $150 million each.

“This is an extraordinary amount of recovery, and I think that we're being too conservative on what we think the per claim eligible form will end up producing,” Rhodes told Donato at the June 4 hearing.

Under the new settlement, the plaintiffs will receive between $200 and $400 million each.