Clearview AI Settles Privacy Lawsuit, Plaintiffs Gain Stake in Company: Report 

The settlement, potentially exceeding $50 million, reportedly offers plaintiffs a stake in the company's future value instead of a conventional monetary payout.
Clearview AI Settles Privacy Lawsuit, Plaintiffs Gain Stake in Company: Report 

Clearview AI, a facial recognition start-up, settled a lawsuit in Illinois on Friday that claimed its extensive database of facial images breached privacy rights. This is as per a report by the AP. 

The settlement, potentially exceeding $50 million, offers plaintiffs a stake in the company's future value instead of a conventional monetary payout, adds the report.

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Clearview AI proclaims itself as an AI company that aims to help reduce crimes, fraud, and other risks and enhance military defense and national security. “Clearview AI’s highly accurate facial recognition platform is protecting our families, making our communities more secure, and strengthening our national security and defense,” reads the company website. 

Legal fees, projected at $20 million, will be deducted from the settlement. Preliminary approval of the deal was given by Judge Sharon Johnson Coleman of the Northern District of Illinois. 

The case brought together claims from around the United States against Clearview. It was claimed that the company created databases by obtaining images from social media and other online sources and marketing them to companies, private citizens, and governmental organizations. 

In 2022, the corporation agreed to stop selling access to its database to private companies or individuals as part of the settlement of another lawsuit in Illinois alleging infringement of privacy rights. 

Notwithstanding Illinois's severe laws on digital privacy, Clearview was still permitted to collaborate with federal and local law enforcement organizations thanks to that agreement, according to the report. However, as part of the settlement’s agreement, Clearview does not admit any liability. 

James Thompson, the attorney representing the company, reportedly said in a written statement, “Clearview AI is pleased to have reached an agreement in this class action settlement.” 

Jon Loevy, who was the lead plaintiffs attorney, reportedly said that they had to come up with a creative solution as the company didn’t have cash to pay fair compensation to the victims. Loevy added, “"Under the settlement, the victims whose privacy was breached now get to participate in any upside that is ultimately generated, thereby recapturing to some extent for some extent for the class the ownership of their biometrics." 

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