Meta settles data privacy lawsuit by paying Texas 1.4 billion

Meta has agreed to pay Texas $1.4 billion in the largest data privacy settlement brought by a state.

“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,” Attorney General Ken Paxton said in a statement Tuesday.

“This serves as a warning to any companies engaged in practices that violate Texans’ privacy rights,” Paxton added.

Texas filed the lawsuit in 2022, accusing Meta of collecting millions of Texans’ private information in violation of the state’s Capture or Use of Biometric Identifier (CUBI) Act and Deceptive Trade Practices Act.

Texas’ biometric privacy law was passed in 2009 and allows for penalties up to $25,000 per violation.

Meta’s feature called Tag Suggestions, which was introduced in 2011, allowed users to tag photographs with the accounts of people in the picture. According to Paxton, Meta violated state law when it turned the feature on for all Texans without explaining how it worked.

For more than a decade, Meta ran facial recognition software on every photograph uploaded to Facebook without receiving users’ consent or informing them that the feature was activated or how it worked. Facebook stopped automated facial tagging in 2021.

Meta settled a class action lawsuit in 2021 for $650 million for allegedly violating the Illinois biometric privacy law. In Tuesday’s settlement, Meta will pay Texas the $1.4 billion over five years. The company did not admit to any wrongdoing.

“We are pleased to resolve this matter, and look forward to exploring future opportunities to deepen our business investments in Texas, including potentially developing data centers,” Meta spokesperson Thomas Richards said in a statement.

Paxton filed a similar lawsuit against Google in 2022 for violating the same biometric privacy law. That case is still pending.

“Any abuse of Texans’ sensitive data will be met with the full force of the law,” Paxton warned Tuesday.

“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.”