Illinois Facebook users to get settlement

“This is real money that Facebook is paying to compensate them for the tangible privacy harms that they suffered. ”

U.S. District Judge James Donato

The check is not yet in the mail, but nearly 1.6 million Illinois Facebook users can expect to get about $350 each in a landmark privacy lawsuit.

The totals were disclosed in a California federal court Thursday during the final approval hearing for a $650 million classaction settlement over alleged violations of Illinois’ biometric privacy law.

The individual payout was projected at about $400 each in November, but that amount was reduced after some 200,000 claims were filed in the final days before the deadline.

U.S. District Judge James Donato, who called the case a “groundbreaking settlement in a novel area,” is expected to issued a final approval order in the coming days, though payouts could still be months away.

“This is money that’s coming directly out of Facebook’s own pocket,” Donato said. “The violations here did not extract a penny from the pockets of the victims. But this is real money that Facebook is paying to compensate them for the tangible privacy harms that they suffered. ”

The Illinois Biometric Information Privacy Act is among the strictest such laws in the U.S., and has spawned a number of lawsuits. It requires companies to get permission before using technologies such as facial recognition to identify customers.

The settlement class included about 7 million Facebook users in Illinois for whom the social network created and stored a face template after June 7, 2011. To qualify, Facebook users had to live in the state for at least six months over the past nine years.

More than 1 in 5 eligible Illinois Facebook users filed a claim in the case by the Nov. 23 deadline. The case spanned more than five years and a 2,000mile change of venue.

In April 2015, Chicago attorney Jay Edelson filed the initial lawsuit in Cook County Circuit Court on behalf of plaintiff Carlo Licata, alleging the social media giant’s use of facial tagging features without consent was not allowed under Illinois privacy law.

The case was moved to Chicago federal court and then California federal court, where it attained classaction status.

Last January, Facebook agreed to settle the lawsuit for $550 million, but Donato rejected the deal. After subsequent negotiations, Facebook agreed to increase the settlement to $650 million, and the court gave the deal preliminary approval in August.

Michael Rhodes, a California attorney representing Facebook, said if the case went to trial, it could have cost the tech giant “billions and billions of dollars” if it had lost.

“I mean, $650 million, by any stretch of the imagination is a tremendous sum of money,” Rhodes said. “It’s not something that Facebook wants to do. But we’re also rational, intelligent people trying to manage a very significant risk.”

The hearing Thursday included discussion about lowering the fee structure. The three law firms representing the plaintiff class are seeking a total of $110 million, or 16.9% of the settlement, plus expenses. A reduction in fees would increase the payout for claimants.

Facebook will pay $650 million into a fund, which will be distributed to those who filed claims after litigation expenses are deducted.

Illinois Facebook users who filed a claim can expect to receive their checks within a few months, pending final approval and barring any appeals, Edelson said Thursday.

“This is a historic settlement and we look forward to reading the court’s opinion when it comes out,” Edelson said.