Meta, the parent company of Facebook and Instagram, agreed Tuesday to a record $1.4 billion settlement with the state of Texas in the U.S. The company was accused of illegally collecting facial recognition information from millions of users, violating state privacy laws.
The lawsuit, filed in 2022, claimed Meta violated Texas privacy laws by automatically tagging users' faces on its site. Texas Attorney General Ken Paxton stated that this settlement is the largest privacy-related settlement by a state in the U.S. Paxton noted that the settlement demonstrates Texas' commitment to holding large technology companies accountable for violating the law and the privacy rights of Texans. The lawsuit involved the collection of data from millions of state residents.
In recent years, Zuckerberg and other big tech companies have faced intense scrutiny from regulators and consumers for privacy abuses. States have become more aggressive in adopting and enforcing privacy laws without a federal law. Previously, Meta paid Illinois $550 million in 2020 to settle a similar lawsuit over facial recognition. Currently, the company faces more than a dozen lawsuits from attorneys general in 45 states and the District of Columbia for unfairly trapping teens and children on its platforms.
Texas law, "Capture or Use of Biometric Identifiers," requires businesses to obtain permission before using facial or voice recognition technologies. The state can impose fines of up to $25,000 per violation. The american state sued Meta over its use of a feature called "tag suggestions", which allowed users to tag individuals in photos using facial recognition software. The tool, introduced in 2011, was automatically activated for users, violating Texas law requiring prior permission.
Some privacy advocates hailed the settlement as a warning to tech companies that use invasive data collection practices. Alan Butler, executive director of the Electronic Privacy Information Center, said the settlement acknowledges the growing risks and threats of unauthorized data collection.
The tech giant did not admit any liability in the settlement. The agreed sum represents a fraction of Meta's revenue of $139 billion in 2023, mostly from its advertising business. A Meta spokesperson expressed satisfaction with resolving the issue and mentioned future investment plans in Texas, such as the development of data centers. Meta stated that it no longer uses the "tag suggestions" feature. In 2022, Texas sued Google for allegedly violating the same biometric privacy law. The state alleged that Google collected voice and facial data through products such as its Nest device. That same year, Google agreed to pay $391 million to settle a lawsuit brought by a coalition of 40 states, accusing it of misleading users about location tracking.
The Meta settlement underscores the increased scrutiny and regulation of data collection practices by technology companies, setting a precedent in protecting citizens' privacy.
