In Texas, Meta Settles Biometric Privacy Flap as Tech Groups Sue Over Kids' Social Media Law

Texas received $1.4 billion from Meta Tuesday, settling claims the Facebook parent captured biometric information in violation of state law. The same day, tech industry groups sued Texas over a kids’ online safety law. NetChoice and the Computer & Communications Industry Association (CCIA) said the 2023 law (HB-18), which requires that social media companies verify users’ ages and get parental consent for children younger than 18, violates the First Amendment in a way similar to a 2021 Texas social media law that went to the U.S. Supreme Court.

Tuesday’s massive Meta settlement is the biggest for Texas and the largest a state has obtained without suing as co-plaintiffs, Attorney General Ken Paxton said (R): It shows “our commitment to standing up to the world’s biggest technology companies and holding them accountable for breaking the law and violating Texans’ privacy rights.” The state’s 2022 lawsuit claimed that Facebook stored biometric data from user photos and videos, without informed consent, in violation of the Texas Capture or Use of Biometric Identifier Act and Texas’ deceptive trade practices law (see 2202140043). Texas filed a similar case against Google (see 2210200075). The agreed final judgment in the Meta case was filed at the Texas District Court in Harrison County.

Meta is “pleased to resolve this matter” and looks “forward to exploring future opportunities to deepen our business investments in Texas, including potentially developing data centers,” the Facebook parent company’s spokesperson said.

Consumer Reports applauds Texas “for holding Meta accountable for its brazenly deceptive collection and misuse of consumers’ biometric data,” Matt Schwartz, CR policy analyst, said. “This critical settlement will reinforce that companies should never secretly collect and share consumers’ biometric data and that they stand to face serious repercussions if they do.” Also, CR was glad that the AG saw “Meta’s lax approach to consent a violation of Texas’ consumer protection statute, even outside of their clear violations of Texas’ biometrics law,” Schwartz added.

Meanwhile, at the U.S. District Court of Western Texas, NetChoice and CCIA sought to stop a Texas 2023 online safety law (see 2306150064) from taking effect Sept. 1. “The law restricts all Texans’ ability to access and engage in protected speech online by requiring them to hand over their sensitive, personal data first,” said Chris Marchese, NetChoice litigation center director, on Tuesday. “This is not only unconstitutional, it’s bad policy.” Marchese added that the law puts children “at a seriously increased risk for exploitation and abuse for cyberattacks from hackers and criminals.”

HB-18 “is Texas’s latest attempt to regulate online speech and information -- and control access to it,” said the NetChoice and CCIA complaint in case 1:24-cv-849. As with its 2021 social media law, “Texas has enacted a law targeting disfavored online publishers and their dissemination of protected, valuable expression online,” they said. On July 1, the Supreme Court remanded the groups’ previous constitutional challenge of the 2021 social media law and a similar Florida law for additional review (see 2407010053 and 2407120044). SCOTUS didn’t explicitly find that those laws violated the First Amendment but said that appeals courts hadn’t properly analyzed them.

The tech groups challenged only the part of the law that regulates social media. “It uniquely burdens those websites’ abilities to continue offering their services to minors,” they said. “Minors are free to encounter speech the Act expressly prohibits on websites left unregulated by the Act.” The district court “should facially enjoin [Texas] from enforcing” the challenged portions of HB-18 “and declare them facially unlawful,” or preclude the state from challenging those provisions “as applied to” NetChoice and CCIA’s members and declare them unlawful as applied to those members, the plaintiffs said. Other courts enjoined similar age-verification laws in California, Arkansas, Ohio and Mississippi, they said.

The Texas online safety law is too vague on what types of speech must be censored under the law, NetChoice and CCIA added. “They reach everything from classic literature such as The Bell Jar, to modern media like 13 Reasons Why, to political discussions,” they said. “The $10,000 penalty per violation of the statute will chill the publication of yet more protected speech.” Such rules also are unnecessary because websites already moderate content considered to be harmful, they said. In addition, the tech groups complained about having to adopt “costly” systems to verify users’ ages and parents. Plus, the law includes a “private right of action that threatens websites with countless individual lawsuits,” they said.

“Our argument is based on well-established federal law, including recent decisions blocking similar laws from other states,” said CCIA Chief of Staff Stephanie Joyce. “At a time when Americans’ access to online information is at a premium, laws like HB18 will restrict the ability of both minors and adults to get online while also putting their privacy at risk.” Texas AG Paxton didn’t comment Tuesday.