Facebook Agrees to Pay $550 Million to Settle Illinois Facial Recognition Lawsuit

Facebook agreed to pay $550 million to settle a class-action lawsuit in Illinois over its use of facial recognition technology in photos that users uploaded to the social network, The New York Times reports. The lawsuit concerned Facebook's auto-labeling feature, Tag Suggestions, which uses face-matching software to suggest names of people in pictures a user uploads. The social network allegedly violated a state biometric privacy law by collecting the data for Tag Suggestions without the permission of Illinois users and without telling them how long the data would be kept, according to the lawsuit. Facebook claimed the accusations had no merit. The company disclosed the settlement, which included a $550 million payment to eligible Illinois users and the plaintiffs' legal fees, in a quarterly earnings call Wednesday. Though the payment amounted to very little of the company's $21 billion revenue in the fourth quarter, Facebook chief financial officer David Wehner said the settlement added to the company's costs. “We decided to pursue a settlement as it was in the best interest of our community and our shareholders to move past this matter,” a spokesman said in a statement.