Facial recognition startup Clearview AI has reached a significant settlement in an Illinois lawsuit that alleged the company's extensive collection of facial images violated privacy rights. The settlement, estimated to be worth over $50 million, offers plaintiffs in the federal suit a unique arrangement to share in the company's potential value rather than a traditional monetary payout.
The case, consolidated from various lawsuits across the U.S., accused Clearview of compiling a database of faces by extracting photos from social media and other online sources, which it then sold to businesses, individuals, and government entities.
Under the terms of the settlement, Clearview has agreed to cease selling access to its database to private entities, following a separate agreement in 2022 that restricted such sales in Illinois due to the state's stringent digital privacy laws. However, the company can still collaborate with federal agencies and law enforcement outside of Illinois.
Notably, Clearview does not admit any liability as part of the settlement agreement. The lead plaintiffs' attorney described the settlement as a 'creative solution' given Clearview's financial constraints, allowing victims of privacy breaches to potentially benefit from any future company success.
The settlement is open to individuals whose images or data are in Clearview's database and who resided in the U.S. from July 1, 2017, onwards. A national campaign will be launched to notify eligible individuals about the settlement.
The agreement was developed with the assistance of a retired federal judge, Wayne Andersen, who highlighted Clearview's financial limitations in court filings. The settlement was seen as a necessary step due to Clearview's inability to meet a substantial legal judgment.
While some privacy advocates and litigants in other cases expressed disappointment with the settlement, citing concerns that it does not address the core issues of Clearview's operations, the agreement represents a significant development in the ongoing legal battles surrounding facial recognition technology.
