Breaking state law

Facebook has agreed to pay $550 million to settle a class action lawsuit filed by Illinois residents, the New York Times reports. Each of the 1.6 million people who filed a complaint will now receive $345 from the social network.

The lawsuit, filed back in 2015, involved one in five Facebook users in Illinois. The reason for the conflict was that users accused the social network of violating the state's biometric privacy law. The company used facial recognition technology on photos without obtaining consent from users to do so. In fact, this would have allowed for the collection and storage of people's biometric data, such as information about the colour of their eyes. The rights of some 6 million people in the state were thus violated and they could legally claim compensation. One in four victims exercised this right.

Facebook's lawyers sought to have the class-action lawsuit stripped of its status, but a federal district court in California refused to grant the company's motion. The social network also attempted to challenge the decision in the US 9th Circuit Court of Appeals, but it too did not agree with the arguments presented. Facebook had previously decided not to use this facial recognition system. In the end, the parties reached an agreement for the company to pay compensation.

According to Facebook's CFO David Wehner, the company "decided to reach a settlement in the interests of the community and its shareholders". A lawyer representing the users noted on Twitter that it was "the largest settlement in history" in terms of total payments in a class action lawsuit launched over breaches of privacy laws in the US. He also said payment cheques could be mailed to plaintiffs within the next two months.

It is worth noting that Facebook has previously faced a similar scandal involving data breaches. Between 2015 and 2016, Cambridge Analytica, a company working with Donald Trump's campaign team, accessed information on 87 million people through the social network in order to intelligently set up political ads. The scandal has led to numerous fines in various countries.