Texas slams Meta with record-breaking $1.4bn fine over facial recognition scandal

In a landmark development, American tech giant Meta has agreed to pay $1.4 billion to settle a lawsuit filed by the state of Texas. The lawsuit, initiated under Texas’s 2009 biometric privacy law, accused Meta of illegally collecting biometric data from millions of Texans through its facial-recognition technology. The settlement, which is to be paid over the next five years, represents the largest accord ever secured by any single state for such violations.

Meta, headquartered in California, has expressed its satisfaction with resolving the matter, despite maintaining its stance of no wrongdoing. A company spokesperson mentioned that Meta is eager to explore new opportunities to deepen its investments in Texas, including potential developments like data centers.

The allegations against Meta

The lawsuit, filed by Texas Attorney General Ken Paxton, revolved around Meta’s use of a now-discontinued feature known as “Tag Suggestions.” This feature, which used photos and videos uploaded by users, was alleged to have collected biometric data “billions of times” without user consent. Under the Texas biometric privacy law, companies can face fines of up to $25,000 per violation, adding to the gravity of the situation for Meta.

Texas Attorney General’s response

Ken Paxton underscored the significance of the settlement, emphasizing Texas’s commitment to enforcing privacy laws and holding large technology firms accountable. He asserted that the settlement highlights the state’s resolve to protect Texans’ privacy rights against any misuse of sensitive data by tech giants. Paxton also revealed that a similar lawsuit is being pursued against Alphabet Inc., the parent company of Google, for alleged illegal biometric data collection practices.

Meta’s future outlook

Despite the legal challenge, Meta’s resolve to strengthen its business ties in Texas remains unwavering. The company is set to pay the settlement amount over a period of five years, a decision that reflects both a strategic and regulatory approach to resolving the dispute. While the settlement addresses the current issue, it also opens the door for future collaborations and investments in Texas.

Expert Opinion

The case underscores a growing trend of legal actions against major tech companies over privacy concerns. With substantial settlements becoming more common, it’s clear that regulatory bodies are increasingly scrutinizing the practices of big tech firms. The legal landscape surrounding data privacy is evolving, and companies like Meta must navigate these changes carefully to avoid further legal entanglements.