22 U.S. States Challenge Clearview AI’s Proposed Privacy Settlement

Twenty-two U.S. states and the District of Columbia have expressed opposition to a proposed settlement addressing privacy claims against facial recognition company Clearview AI. The settlement, which received preliminary approval from Judge Sharon Johnson Coleman of the Northern District of Illinois, offers plaintiffs a portion of Clearview’s potential future value rather than traditional monetary compensation—a unique approach in privacy litigation that would effectively turn claimants into shareholders.

The proposed agreement, estimated to be worth over $50 million, including approximately $20 million in attorney fees, would cover U.S. individuals whose data has been in Clearview’s database since July 1, 2017. Clearview AI has not admitted to any wrongdoing as part of this settlement. The case arises from alleged violations of the Illinois Biometric Information Privacy Act (BIPA), which requires companies to obtain explicit consent before collecting and storing biometric data.

Clearview AI, founded by Hoan Ton-That, built its business by collecting facial images from social media platforms and the internet, creating a comprehensive database that it marketed to law enforcement agencies and other entities. The company’s database has grown to include billions of images, sparking controversy over privacy rights and consent in the digital age. While Clearview maintains its technology serves crucial law enforcement purposes, as well as supporting Ukraine’s defense efforts, critics argue its data collection methods violate privacy rights.

In 2022, Clearview AI reached an agreement to cease selling database access to private entities in Illinois while maintaining its ability to work with federal agencies and law enforcement outside the state. The company has faced significant regulatory scrutiny globally, with the United Kingdom’s ICO imposing a £7.5 million fine and Australian authorities implementing strict restrictions on its operations.

The widespread state opposition to the current proposed settlement reflects growing concerns about facial recognition technology and data privacy. A GAO report revealed broad support for facial recognition among federal agencies, even as lawmakers and privacy advocates push for stronger regulations. The case represents one component of ongoing legal and regulatory examination of facial recognition technology and data collection practices in the digital era, with potential implications for future privacy settlements and corporate accountability measures.

Sources: Reuters

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December 16, 2024 – by Cass Kennedy