Google has agreed to settle a class action lawsuit alleging that its Chrome browser kept tracking users’ browsing activity even when they had enabled the ‘Incognito mode’ feature, which is meant to hide their activities.

The lawsuit, originally filed in June 2020, accused Google LLC of violating federal wiretapping laws and California’s privacy laws by continuing to collect data on users through various means like Google Analytics, plugins, and ads even when users browsed the internet by relying on Incognito mode.

The terms of the settlement are private, and neither Google nor the plaintiffs have disclosed the specifics. However, lawyers for both parties have signed a binding term sheet following mediation sessions and intend to present the official settlement for court approval by February 24, 2024. This delays the trial that was originally set for February 2024.

Google Misguided Users Regarding How Incognito Mode Works

The lawsuit started because of how Incognito mode works in the Chrome Web Browser, which is made by Google (GOOG). Although it doesn’t save browsing history, cookies, site data, or entered form fields after you close it, websites can still track and identify users using data such as IP addresses, hardware fingerprints, and other similar indicators.

The plaintiffs allege that Google kept collecting this identifiable data via its widespread analytics services, ad networks, and other remote means and then used it to target ads without users’ consent.

Here’s where the problem lies: let’s say John is visiting websites about depression while signed out and using Incognito mode. Later, John decides to visit the same sites in Incognito mode believing his activity cannot be tracked remotely.

The complaint alleged that Google still tracked which sites John visits various tools including Google Analytics and Ad Manager and then used this sensitive health data for ad-targeting and analytics purposes without John’s consent.

The lawsuit originally demanded a payment ranging between $100 to $100 per affected user as compensation. These legal costs could exceed the $5 billion mark given that millions of users were likely impacted since 2016.

While Google has agreed to settle, presumably for a lower amount, the actual settlement figures are still private and may remain as such if the two parties agree not to disclose the details of the arrangement.

Google Claimed that It Warned Users Regarding the Limitations of the Feature

Earlier in 2021, Google filed a motion to dismiss the lawsuit that hinged on the argument that the Incognito warning splash screen explicitly informed that users’ browsing activity would still be tracked to collect information by its services. The warning states “Your activity might still be visible to: Websites you visit, Your employer or school, Your internet service provider”.

Also read: Top Privacy-Focused Browser DuckDuckGo Launches Windows Browser as Better Alternative to Chrome

However, federal judge Yvonne Gonzalez Rogers rejected Google’s motion and ruled that the disclaimer still left open the question of whether users had consented to Google itself collecting data remotely via tools like Analytics.

The judge’s ruling stated: “…Because Google never explicitly told users that it does so, the Court cannot find as a matter of law that users explicitly consented to the at-issue data collection”. This paved the way for a trial early next year before Google agreed to settle.

While the settlement’s details are still private, the outcome of the case may set an important precedent and possibly influence similar lawsuits against other tech companies whose web browsers offer a similar feature.

Beyond browsers, many smartphone applications also claim to offer tracking-free private experiences that could potentially be scrutinized as well if they are found to be violating users’ expectations concerning their privacy.

Also read: Google Aims to Resolve Latest Antitrust Hurdle Following Android Automotive Investigation

The lawsuit and Google’s willingness to settle underscore growing public skepticism over online privacy and the attitudes that have catalyzed stronger data and privacy regulations worldwide.

It remains to be seen if the settlement sets limitations on Google itself regarding how it tracks private users via remote means – including signed-out users – and leads to changes in Chrome’s Incognito mode and the messaging around its protections.

Analysis of the final settlement, whenever revealed, will also offer more insights into Google’s appetite for engaging in legal battles over certain issues, particularly those touching its reputation concerning users’ privacy at a time when tech companies are being pressured by regulators to give up certain practices and aiming to restore the public’s trust.

For now, internet users are left knowing that Incognito does not cloak web activity entirely. More details on the deal should be revealed within the next two months once the final agreement is drafted.