U.S. TikTok Users May Be Eligible to Receive Funds From $92 Million Settlement

The suit alleges that the popular video-sharing app used personal data from users without their consent.

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By Amanda Breen

TikTok's parent company ByteDance has agreed to a $92 million settlement after a class-action lawsuit alleged the company used personal data from users without their consent.

On Monday, TikTok users received an in-app notification about submitting a claim for compensation.

Approximately 89 million TikTok users have been impacted, and if you used TikTok — or Musical.ly, which predated the app — before October 1, you may be eligible to collect some (read: a fraction of a fraction of a fraction) of that $92 million.

The settlement follows the filing of 21 lawsuits, many of which were filed on behalf of minors.

Documents filed in U.S. District Court in Illinois claim that TikTok uses a "complex system of artificial intelligence to recognize facial features in users' videos" and that it examines faces to "determine the user's age, race/ethnicity and gender ... to recommend content and profiles for the user to follow."

The documents go on to say that the "improperly obtained data" gives TikTok a competitive advantage over other social-media apps and helps generate profits for the company. The suit also alleges that some of that data was extracted from draft videos that users never posted.

Illinois is the only state that permits people to sue companies for violating biometric privacy laws.

Related: Americans Want Facebook and TikTok Banned Over Privacy

TikTok has denied all allegations and says it agreed to the cash settlement to avoid a trial. "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," a TikTok spokesperson told Insider.

As part of the settlement, TikTok will delete some user data, but it's unclear whether the company will remove the facial-recognition data it's already gathered. TikTok said it will no longer collect biometric data.

Those who wish to submit a claim must do so on the TikTok data privacy settlement website by March 1.

Although $92 million might sound like a significant payout, individuals are unlikely to see much cash. If everyone eligible submits a claim, most will only receive about $0.96 after attorneys' fees.

Related: TikTok Risks Annoying Teenagers by Offering Parents More Control

Amanda Breen

Entrepreneur Staff

Features Writer

Amanda Breen is a features writer at Entrepreneur.com. She is a graduate of Barnard College and recently completed the MFA in writing at Columbia University, where she was a news fellow for the School of the Arts during the 2020-2021 academic year. 

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