Meta Platforms Inc. has reached a record $1.4 billion settlement with the state of Texas to resolve a privacy lawsuit that alleged the tech giant misused facial biometric data without user consent.
The Meta facial recognition lawsuit settlement, the largest secured by a single state, comes after years of scrutiny over Meta’s data practices. In 2021, the company, formerly known as Facebook, agreed to pay $650 million to settle a similar case brought by Illinois residents.
Meta Facial Recognition Lawsuit Settlement Sets Record
“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,” said state Attorney General Ken 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. Any abuse of Texans’ sensitive data will be met with the full force of the law.”
Meta said it was pleased to resolve the matter and looks forward to expanding its business in Texas. However, the company’s stock price, which opened the day at $467, fell to a low of $457 after the lawsuit deal announcement before rebounding.
The record $1.4 billion settlement is unlikely to weigh a lot on Meta’s business since the California-based tech giant made a profit of $12.37 billion in the first three months of this year on revenue of $36.46 billion, an increase of 27% from a year earlier. Meta is scheduled to report its second-quarter earnings results on Wednesday.
The Texas lawsuit, filed in 2022, accused Meta of violating a state law prohibiting the collection and sale of biometric information, such as facial and fingerprint data, without explicit user permission.
In 2020 – when the company was known as Facebook – Meta settled a similar lawsuit with the state of Illinois for $650 million where the tech giant allegedly used photo face-tagging and other biometric data without the permission of its users. U.S. district judge James Donato approved the deal at the time in a class-action lawsuit that was filed in Illinois in 2015.
Facebook Face Recognition System and Data Deleted in 2021
In response to growing privacy concerns, Meta discontinued its face recognition system in 2021 and deleted billions of facial templates. However, the company faced criticism for previously enabling the feature by default.
Paxton has also filed a similar lawsuit against Google, alleging the company collected biometric data through its products and services. That case is ongoing.
