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I find it weird how people compare a fine for some specific conduct to the revenue or profit of an entire company. In this case, the illegal use of facial recog

I find it weird how people compare a fine for some specific conduct to the revenue or profit of an entire company. In this case, the illegal use of facial recognition probably slightly increased engagement for photo sharing features. That’s worth something but it obviously only accounts for a very small portion of the company’s revenues. If the story was “judge declares entirety of Facebook enterprise illegal, punishment is $550M fine” I would get the outrage.

Traster 7y ago
You need to view this in the context of all the things facebook is doing. They might get fined $550m for this one thing, but how many projects is Facebook engaged in that skirt regulations or outright breach them? Dozens of projects? Hundreds? So you can't compare the $550m against only the facial recognition, you've got to compare it against the entire suite of questionable things they're doing. THe point is that the corporate strategy is to skirt these lines and the success of that strategy is the cumulative success of all the projects along with the handful of fines they hit. So you've got to have disproportionate fines because you know enforcement is patchy.
- bryan_w 7y ago
  I ... don't think you're grounded in reality. What do you think Facebook is doing right now that currently break the law? Please, be specific.
  - freeflight 7y ago
    Tracking users without their consent or them actually being users [0] is probably one of the most blatant ones for people in the EU. But it's not like there's a lack of other issues to pick from [1], of course, one can insist on it all being "alleged", but let's be real here on hackernews: If it's technically feasible, then it's most likely being done, legalities are regularly just an afterthought to the actual product, particularly when it's about the monetization of user data. A lot of that might be completely legal in the US with law-doctrines that undermine privacy expectations on a fundamental level [3], but the US isn't the whole world. [0] https://www.reuters.com/article/us-facebook-privacy-tracking/facebook-fuels-broad-privacy-debate-by-tracking-non-users-idUSKBN1HM0DR https://www.reuters.com/article/us-facebook-privacy-tracking... [1] https://en.wikipedia.org/wiki/Criticism_of_Facebook https://en.wikipedia.org/wiki/Criticism_of_Facebook [2] https://en.wikipedia.org/wiki/Third-party_doctrine https://en.wikipedia.org/wiki/Third-party_doctrine
- robinwassen 7y ago
  Following your logic they now have dozens/hundreds of projects risking $550 million fines. If I was Facebook I would become quite uneasy by that.
- djannzjkzxn 7y ago
  When Facebook gets sued for all that other wrongdoing, they can pay out for it. Maybe you boost the fines by weighing the probability of getting caught. Facebook has been fined before and many other legal conflicts are ongoing, so it’s not as though they are getting a pass. If Facebook gets a company-destroying fine for each act of wrongdoing, then it’s just a race where the first victims to prosecute get compensated. The slowpokes are screwed because the company has nothing left to pay out. This seems like a less fair system than one where fines are proportional to the value extracted or damages caused by the illegal conduct.
  - disiplus 7y ago
    while i understand what you are saying, i don't think the law should be like that, especially for companies, where in the end nobody is going to jail. if we see it just like that then the breaking a law is just a calculated risk. And companies take calculated risks all the time, they will take it. There is my mind no way that facebook did not know that they are breaking the law. if we allow that the law is just one parameter in the strategy, then the law is just a tax that you have to pay if you get caught.
Aissen 7y ago
Unfortunately, that's how the justice system works, it's basic game theory. Because we don't want or can't give infinite budget to justice, we need to make sure corporations and citizens abide by the law and put the burden on verifying it on them. If we had time and money to verify every Facebook project, sure, we could have fines proportionate to whatever they got in profit from that project. The reality is we don't, so we need to make sure Facebook is self-policing.
- amelius 7y ago
  What if Facebook paid an independent investigator (selected by the DoJ) to determine the profits generated by a project?
rayiner 7y ago
Yes. This is actually a huge settlement, driven by the fact that the Illinois biometric law has statutory damages of $1,000-5,000 per incident. As the article notes, the Equifax settlement was smaller despite being involving way more customers. Because proving actual harm for privacy violations is difficult.
- heartbreak 7y ago
  The prior media coverage of this suit described it as a $35bn lawsuit, because the working number was 7mm incidents and the media assumed (and plaintiff alleged) Facebook acted “intentionally or recklessly” and went with the $5k/incident damages. If we assume the 7mm Illinois resident incidents number is correct, Facebook settled for about $79/incident. On the one hand Facebook would obviously not want to pay any amount in a lawsuit over their facial recognition feature, but on the other hand the law was about 1% as impactful as it had been written to be.
vertex-four 7y ago
People get fined disproportionately to the actual cost of whatever they were doing, regularly, as a disincentive. Quite often it’s a significant portion of their pay check. We consider this normal. Why should it be different for companies?
- rtpg 7y ago
  There’s a thing often used of “fine triple the financial gain”. Fines towards individuals tend to be associated to the crime committed , not to the persons paycheck. Why should it be different for companies?
  - zxcmx 7y ago
    Some believe that some fines should be a proportion of income, even for individuals. Fixed financial penalties are inherently regressive; they disproportionately punish the poor and provide no disincentive to the sufficiently rich. I believe this has been implemented for speeding fines in some countries.
SkyBelow 7y ago
Even many minor laws include a short jail sentence. Imagine if the penalty was that facebook had to full shutdown everything for 2 months. In comparison, a fine that you'll make up in no time is not a punishment at all, just a fee for the privilege of being allowed to ignore the law. This fine for facebook is comparable to a speeding ticket price for a minimum wage worker. Is the crime on the level of speeding?
- SpicyLemonZest 7y ago
  I'd argue it is. Nobody's claiming that Facebook has caused direct or serious harm here; they've just broken the rules that we put in place to ensure people who do want to do nasty things with your data can't do it. That's very analogous to speeding, which by itself harms nobody but is part of a regulatory system to minimize car accidents.
esotericn 7y ago
Companies are fined in lieu of having their liberty constrained because it's not practical to do the latter. If you as an individual perform an action that is punished by 6 months' jail time then all of your activities are curtailed. You're not just prevented from like, picking up a kitchen knife, you're locked in a box.
whatitdobooboo 7y ago
Maybe this is precedent?

Traster 7y ago

You need to view this in the context of all the things facebook is doing. They might get fined $550m for this one thing, but how many projects is Facebook engaged in that skirt regulations or outright breach them? Dozens of projects? Hundreds? So you can't compare the $550m against only the facial recognition, you've got to compare it against the entire suite of questionable things they're doing. THe point is that the corporate strategy is to skirt these lines and the success of that strategy is the cumulative success of all the projects along with the handful of fines they hit. So you've got to have disproportionate fines because you know enforcement is patchy.

bryan_w 7y ago
I ... don't think you're grounded in reality. What do you think Facebook is doing right now that currently break the law? Please, be specific.
- freeflight 7y ago
  Tracking users without their consent or them actually being users [0] is probably one of the most blatant ones for people in the EU. But it's not like there's a lack of other issues to pick from [1], of course, one can insist on it all being "alleged", but let's be real here on hackernews: If it's technically feasible, then it's most likely being done, legalities are regularly just an afterthought to the actual product, particularly when it's about the monetization of user data. A lot of that might be completely legal in the US with law-doctrines that undermine privacy expectations on a fundamental level [3], but the US isn't the whole world. [0] https://www.reuters.com/article/us-facebook-privacy-tracking/facebook-fuels-broad-privacy-debate-by-tracking-non-users-idUSKBN1HM0DR https://www.reuters.com/article/us-facebook-privacy-tracking... [1] https://en.wikipedia.org/wiki/Criticism_of_Facebook https://en.wikipedia.org/wiki/Criticism_of_Facebook [2] https://en.wikipedia.org/wiki/Third-party_doctrine https://en.wikipedia.org/wiki/Third-party_doctrine
robinwassen 7y ago
Following your logic they now have dozens/hundreds of projects risking $550 million fines. If I was Facebook I would become quite uneasy by that.
djannzjkzxn 7y ago
When Facebook gets sued for all that other wrongdoing, they can pay out for it. Maybe you boost the fines by weighing the probability of getting caught. Facebook has been fined before and many other legal conflicts are ongoing, so it’s not as though they are getting a pass. If Facebook gets a company-destroying fine for each act of wrongdoing, then it’s just a race where the first victims to prosecute get compensated. The slowpokes are screwed because the company has nothing left to pay out. This seems like a less fair system than one where fines are proportional to the value extracted or damages caused by the illegal conduct.
- disiplus 7y ago
  while i understand what you are saying, i don't think the law should be like that, especially for companies, where in the end nobody is going to jail. if we see it just like that then the breaking a law is just a calculated risk. And companies take calculated risks all the time, they will take it. There is my mind no way that facebook did not know that they are breaking the law. if we allow that the law is just one parameter in the strategy, then the law is just a tax that you have to pay if you get caught.

Aissen 7y ago

Unfortunately, that's how the justice system works, it's basic game theory. Because we don't want or can't give infinite budget to justice, we need to make sure corporations and citizens abide by the law and put the burden on verifying it on them. If we had time and money to verify every Facebook project, sure, we could have fines proportionate to whatever they got in profit from that project. The reality is we don't, so we need to make sure Facebook is self-policing.

amelius 7y ago
What if Facebook paid an independent investigator (selected by the DoJ) to determine the profits generated by a project?

rayiner 7y ago

Yes. This is actually a huge settlement, driven by the fact that the Illinois biometric law has statutory damages of $1,000-5,000 per incident. As the article notes, the Equifax settlement was smaller despite being involving way more customers. Because proving actual harm for privacy violations is difficult.

heartbreak 7y ago
The prior media coverage of this suit described it as a $35bn lawsuit, because the working number was 7mm incidents and the media assumed (and plaintiff alleged) Facebook acted “intentionally or recklessly” and went with the $5k/incident damages. If we assume the 7mm Illinois resident incidents number is correct, Facebook settled for about $79/incident. On the one hand Facebook would obviously not want to pay any amount in a lawsuit over their facial recognition feature, but on the other hand the law was about 1% as impactful as it had been written to be.

vertex-four 7y ago

People get fined disproportionately to the actual cost of whatever they were doing, regularly, as a disincentive. Quite often it’s a significant portion of their pay check. We consider this normal. Why should it be different for companies?

rtpg 7y ago
There’s a thing often used of “fine triple the financial gain”. Fines towards individuals tend to be associated to the crime committed , not to the persons paycheck. Why should it be different for companies?
- zxcmx 7y ago
  Some believe that some fines should be a proportion of income, even for individuals. Fixed financial penalties are inherently regressive; they disproportionately punish the poor and provide no disincentive to the sufficiently rich. I believe this has been implemented for speeding fines in some countries.

SkyBelow 7y ago

Even many minor laws include a short jail sentence. Imagine if the penalty was that facebook had to full shutdown everything for 2 months. In comparison, a fine that you'll make up in no time is not a punishment at all, just a fee for the privilege of being allowed to ignore the law. This fine for facebook is comparable to a speeding ticket price for a minimum wage worker. Is the crime on the level of speeding?

SpicyLemonZest 7y ago
I'd argue it is. Nobody's claiming that Facebook has caused direct or serious harm here; they've just broken the rules that we put in place to ensure people who do want to do nasty things with your data can't do it. That's very analogous to speeding, which by itself harms nobody but is part of a regulatory system to minimize car accidents.

esotericn 7y ago

Companies are fined in lieu of having their liberty constrained because it's not practical to do the latter. If you as an individual perform an action that is punished by 6 months' jail time then all of your activities are curtailed. You're not just prevented from like, picking up a kitchen knife, you're locked in a box.

whatitdobooboo 7y ago

Maybe this is precedent?