JUST IN: Federal Judge Drops the Hammer on Facebook with New Ruling

If Facebook CEO Mark Zuckerberg thought last week was bad, this one might be worse.

Before Zuckerberg’s two days of grilling by D.C. lawmakers had even faded from the headlines, the company was back in the spotlight on Monday with a federal judge’s ruling to allow a class action lawsuit against Facebook over a facial recognition feature.

And the damages could be in the billions.

According to Reuters, U.S. District Judge James Donato ruled on Monday that a suit against Facebook could proceed under class action status for users in Illinois who sued the company in 2015 alleging Facebook was violating a state law by collecting “biometric information.”

That opens the way for individual users to sue as a group, substantially increasing the potential penalties the company might have to face.

The suit stems from the popular practice of “tagging” photos.

As Bloomberg reported:

“Facebook has for years encouraged users to tag people in photographs they upload in their personal posts and the social network stores the collected information. The company has used a program it calls DeepFace to match other photos of a person. Alphabet Inc.’s cloud-based Google Photos service uses similar technology and Google faces a lawsuit in Chicago like the one against Facebook in San Francisco federal court.”

According to Bloomberg, the suit was initially filed in Illinois, but the California-based Facebook successfully argued to have it moved to San Francisco. The home court advantage didn’t pay off, though.

In his ruling, Donato wrote that “Facebook seems to believe that a class action is not (warranted) because statutory damages could amount to billions of dollars.”

However, he wrote “substantial damages are not a reason to decline Class certification because it is within the Court’s discretion to reduce a liquidated damages award with due process at a later stage of the proceedings.”

And the damages could be substantial indeed. The Illinois law in question, the Biometric Information Privacy Act of 2008, allows for damages up to $5,000 for each time a person’s image is used without consent.

Donato’s ruling creates a potential class of Facebook users in Illinois whose pictures were collected by Facebook after June 7, 2011, under its “Tag Suggestions” feature. The date is when Facebook launched the program.

Given that there were 6 million Facebook users in Illinois at the time, the number of potential violations of the 2008 law is staggering. Multiplied by $5,000 each, the “billions” Donato ruling mentions is easy to imagine.

Zuckerberg’s two days on the hot seat last week in front of House and Senate lawmakers was no doubt extremely uncomfortable (just wearing a tie that long is probably uncomfortable for Zuckerberg.)

But a federal judge’s ruling in what should be the friendly confines of a San Francisco courthouse has to be a lot worse.

The congressional hearings only took a toll on Zuckerberg’s image. Even if the facial recognition case is likely headed for an out-of-court settlement, that hammer Donato dropped hammer on Facebook in Monday’s ruling is going to be landing on the company’s bottom line.