3 min read
Google has agreed to pay $1.375 billion to the state of Texas to settle two major lawsuits over alleged violations of data privacy laws.
This deal, announced by Texas Attorney General Ken Paxton, marks the largest-ever recovery by any U.S. state from Google for breaching privacy protections.
“For years, Google secretly tracked people’s movements, private searches, and even their voiceprints and facial geometry through their products and services. I fought back and won,” said Paxton, hailing the outcome as a “historic win” for the rights of Texans.
What was Google accused of?
The lawsuits, originally filed in 2022, accused Google of illegally collecting sensitive user data without consent. This included geolocation tracking, incognito mode searches, and biometric identifiers such as voiceprints and facial features. Products cited in the lawsuit included Google Assistant, Google Photos, and Nest Hub Max.
Paxton’s office claimed the tech giant violated privacy laws by failing to properly inform users or get permission for data collection, going as far as tracking them even in private browsing modes.
The size of Texas’s settlement dwarfs previous payouts Google made to other states. For example:
- A 40-state coalition reached a $391 million settlement in 2022.
- No single state has secured more than $93 million from Google—until now.
In contrast, Texas’s $1.375 billion figure matches the amount the state previously obtained from Meta (Facebook’s parent company) over a facial recognition case, making it part of a broader crackdown on Big Tech led by Paxton.
Google’s Response
Despite agreeing to the settlement, Google made it clear that the company is not admitting to any wrongdoing.
“This settles a raft of old claims, many of which have already been resolved elsewhere, concerning product policies we have long since changed,” said José Castañeda, a Google spokesperson.
The company emphasized that the agreement does not require any changes to its current products or services. According to Castañeda, Google has already enhanced its privacy features as a result of earlier lawsuits in other states.
Impact on Alphabet’s Stock
The announcement did have a financial ripple effect. Alphabet Inc., Google’s parent company, saw its share price dip from a morning high of $156.14 to a low of $153.95 on Friday. It slightly recovered during after-hours trading, closing at $154.17, but the downward trend continued into Saturday, falling further to $152.27.
The settlement comes amid mounting legal pressure on Google. The tech giant is currently facing multiple antitrust rulings, with some decisions pushing for the divestment of key assets like Chrome and parts of its advertising business. Google has vowed to appeal these rulings.
Meanwhile, growing competition from AI-driven platforms like ChatGPT is also challenging Google’s dominance in web search, with reports of declining usage on iPhones following Apple’s internal updates.
What’s Next?
While the settlement concludes the legal battle with Texas, it remains unclear how the $1.375 billion will be used or whether any portion will be distributed directly to affected users. Paxton, however, is already looking ahead, recently announcing his intention to challenge Senator John Cornyn in next year’s mid-term elections.
As watchdogs continue scrutinizing Big Tech, this record-breaking deal serves as a powerful message: “In Texas, Big Tech is not above the law.”
