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TikTok settles privacy lawsuit for $92 million

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TikTok has agreed to pay $92 million to settle a class-action lawsuit that alleged the video-sharing social networking service illegally collected some teenage TikTok users’ data, according to court filings.

A judge still has to approve the deal.

The class-action lawsuit stemmed from 21 separate class-action lawsuits filed in California and Illinois last year.

The proposed settlement in the US District Court for the Northern District of Illinois could put an end to a series of lengthy disputes over whether TikTok unlawfully collected private and biometric data of users.

If accepted by a federal judge, the settlement, filed in the US District Court for the Northern District of Illinois, will be divided among US-based users of the app. The case was heard in Illinois, which has stringent laws around the use of biometrics.

In addition, the settlement would necessitate the creation of a compensation fund for TikTok users. In addition, the company would be required to implement a new "privacy compliance" training programme and would have to take additional steps to protect users’ information.

According to the proposed settlement, the video sharing giant was accused of using a "complex system of artificial intelligence (AI)" to recognise facial features in user videos, and also recommend stickers and filters. Moreover, algorithms are cited as a means to pinpoint users’ age, gender, as well as ethnicity.

This settlement is a colourful example of how a lack of transparency or questionable privacy practices will not be tolerated in the US anymore.

Ilia Kolochenko, ImmuniWeb.

In addition, the lawsuit alleged that data on users was sent to China, as well as shared with third-parties, without users’ consent.

TikTok denies it has done anything wrong, but said in a statement: "While we disagree with the assertions, rather than go through lengthy litigation, we'd like to focus our efforts on building a safe and joyful experience for the TikTok community.”

Ilia Kolochenko founder and CEO of ImmuniWeb, says: “If approved by the judge, it will be a very favourable settlement for the wealthy defendant despite the comparatively large amount. The alleged conduct likely violates a wide spectrum of the US state and federal laws, and it seems that some private plaintiffs and state attorneys general didn’t participate in the lawsuit because of the pandemic.”

He says, importantly, this settlement does not preclude other claims TikTok may get in the future from plaintiffs who didn’t participate in this class action.

"In any case, however, this settlement is a colourful example of how a lack of transparency or questionable privacy practices will not be tolerated in the US anymore,” he adds.

The US vigorously follows the EU way of strong privacy protection, both on a federal and a state level. 

“Under Joe Biden's administration, we can expect more regulatory scrutiny and probably even a federal privacy law for all 50 states,' says Kolochenko. "They should, however, be prudent not to over-regulate and make the business of some companies impossible by new compliance costs.”


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