Get the latest market trends in your inbox
Stay on top of the latest market trends and economic insights with the Axios Markets newsletter. Sign up for free.
Catch up on coronavirus stories and special reports, curated by Mike Allen everyday
Catch up on coronavirus stories and special reports, curated by Mike Allen everyday
Denver news in your inbox
Catch up on the most important stories affecting your hometown with Axios Denver
Des Moines news in your inbox
Catch up on the most important stories affecting your hometown with Axios Des Moines
Minneapolis-St. Paul news in your inbox
Catch up on the most important stories affecting your hometown with Axios Minneapolis-St. Paul
Tampa-St. Petersburg news in your inbox
Catch up on the most important stories affecting your hometown with Axios Tampa-St. Petersburg
Illustration: Sarah Grillo/Axios
Facebook said on Wednesday it will pay $550 million in response to an Illinois-based class-action lawsuit against the facial recognition technology in its photo-labeling service, the New York Times reports.
The big picture: The settlement is a sign that state-level regulations on facial recognition can extract real penalties from social media giants like Facebook, as more states introduce bills to regulate, ban or study the tech.
What's next: Facebook will be required to "obtain full consent from Illinois consumers before any collection of their biometric information takes place" under the terms of the settlement, according to a Wednesday press release from the firms representing Illinois Facebook users, who are plaintiffs in the case.
- Each member of the lawsuit "is likely to be compensated $200 or more," according to the firms.
Details: Facebook’s Tag Suggestions feature uses face-matching software to scan users' photos and suggest names for each person pictured. The lawsuit accused Facebook of violating Illinois biometric privacy law by amassing users' facial data without their consent or explaining how long the data would be stored, the Times reports, noting that "Facebook has said the allegations have no merit."
- The fine amounts to the largest-ever cash settlement resolving a privacy-related lawsuit, the firms representing Illinois Facebook users claimed on Wednesday.
What they're saying: Facebook’s chief financial officer David Wehner told investors in an earnings call that the $550 million settlement added to the site's increasing administrative and general costs, which have grown 87% from last year, according to the Times.
Go deeper: Facebook expands its use of facial recognition technology