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Facepalm: Meta attempted to use Facebook as a giant surveillance service to profit from users' personal data. The company ultimately failed in the endeavor and is now facing significant financial penalties as a result, which includes a massive settlement due to the state of Texas over the next five years.
Texas Attorney General Ken Paxton collected a $1.4 billion settlement from Meta over Facebook's misuse of facial recognition algorithms. Meta had collected and used the personal biometric data of millions of Texans without prior authorization. According to Paxton's official statement, this settlement is the largest ever obtained from legal action initiated by a single US state.
Paxton's office filed the lawsuit against Meta in February 2022, following revelations that Facebook had been secretly gathering biometric data for over a decade. In 2011, the social network introduced its Tag Suggestions feature, designed to make it easier for users to tag people in photos. This feature was enabled by default, with no clear explanation of how the underlying technology worked.
Tag Suggestions utilized facial recognition software that analyzed "virtually" every face in photos shared by users. Data on the "facial geometry" of countless individuals was stored in Facebook's database, a practice that violated Texas's Capture or Use of Biometric Identifier Act and the Deceptive Trade Practices Act.
"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," Paxton said. Meta was ultimately forced to stop scanning Facebook photos.
Fearing legal "uncertainty" surrounding facial recognition algorithms, Facebook reportedly decided to erase the biometric data collected from more than a billion users. However, this move was not sufficient to deter the Attorney General of Texas, who proceeded with a lawsuit against Meta a year later.
In 2021, Facebook agreed to pay a $650 million settlement to resolve a class-action lawsuit in Illinois, which sought to enforce local privacy laws against extensive biometric scanning practices.
Before settling the Texas lawsuit, Meta argued that the Attorney General's claims were without merit. Now, having agreed to a $1.4 billion settlement over a five-year period, the company has expressed satisfaction with the resolution of the matter. Meta is also reportedly looking to increase its investments in Texas, including plans to build new data centers.