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Report: Facebook loses lawsuit appeal over facial recognition software

A federal appeals court blocked Facebook Inc.'s request to stop a privacy suit from proceeding as a class-action lawsuit for users in Illinois, Bloomberg News reported Aug. 8.

The lawsuit, which involves a facial recognition tool that allows users to identify people on pictures uploaded to Facebook goes back as far as 2011 and alleged that Facebook was collecting and storing biometric data without user consent.

The court's ruling falls under the Illinois Biometric Information Privacy Act of 2008, which provides for fines up to $5,000 each time a user's image is used without consent.

A Facebook spokesperson told Bloomberg News that the company "always disclosed our use of face recognition technology," and added that users can turn the technology off or on at any time.

The decision comes at a time when Facebook is faced with increased scrutiny related to the company's user data practices. Last month, Facebook agreed to pay a record $5 billion fine to settle a data privacy investigation with the U.S. Federal Trade Commission.