The embattled AI data annotation firm Sama is winding down its operations and liquidating its assets, according to a letter to creditors reviewed by TIME.
The letter, dated Nov. 6, blames “declining revenues due to increased competition that was compounded by recent class action litigation that would have required significant resources and years to defend successfully.” The letter does not specify which class-action litigation contributed to Sama’s financial difficulties. The company has faced separate such lawsuits in Kenya and the U.S.
An unaudited balance sheet attached to the letter shows Sama had approximately $1 million in assets and $17 million in liabilities as of October.
TIME previously reported that Sama performed content moderation for Meta and data labeling for OpenAI, work that employees said exposed them to traumatic content without adequate safeguards.
Read More: Inside Facebook’s African Sweatshop
Sama and Meta are facing lawsuits in Kenya related to allegations that former Facebook content moderators were exploited and illegally terminated after they raised concerns, and that Sama illegally suppressed a unionization effort.
Specifically, Daniel Motaung, a former Sama moderator who was fired in 2019 after trying to organize a strike, sued Sama and Meta in 2022, claiming violations of constitutional rights including freedom of association, dignity and fair working conditions, as well as alleged forced labour and human trafficking. His petition has since been consolidated with a separate one brought by former moderators who allege they were unlawfully made redundant and blacklisted. Sama has said it complied with Kenyan labor law, and Meta denied responsibility for the working conditions.
Earlier this year, Sama separately came under fire for its work handling data from Meta’s AI-powered smart glasses. Workers told Swedish newspapers Svenska Dagbladet and Göteborgs-Posten that they were required to review private content from the glasses’ cameras, including people using the toilet, changing clothes, and having sex. Sama was initially named as a defendant in several proposed class-action privacy lawsuits against Meta and glasses manufacturer Luxottica, but plaintiffs voluntarily dropped their claims against Sama in August. (Meta denies the claims and says it will fight them, adding that while it may review data from smart glasses to improve its products, it takes steps to filter out private information. Luxottica did not respond to a request for comment.)
On October 23, Samasource Impact Sourcing, Inc., the U.S. company operating as Sama, transferred its assets to a newly formed company, Sama ABC, to oversee their sale and distribute the proceeds to creditors. Sama ABC is administered by “professionals who specialize in liquidating insolvent or otherwise financially distressed companies for the benefit of their creditors,” according to the letter. Despite the similar names, the letter says Sama ABC is not corporately affiliated with the company.
“Sama leaves a highly regarded legacy as being one of the earliest champions of impact sourcing: a model centered on deliberately hiring individuals from marginalized communities in East Africa,” the letter states. “Through this model, the company directly impacted over seventy thousand lives with life skills and technical training and employment in digital work at high living wages and benefits. Its impact extended throughout the communities it served due to the material wealth ripple effect created by its targeted employment model.”
The letter notes that a bank has a priority claim to “substantially all” of the company’s assets. The letter does not say what the liquidation means for the ongoing case in Kenya.
An email to Sama’s press inbox bounced. Sama’s CEO, Wendy Gonzalez, did not immediately respond to a request for comment. Sama ABC representatives did not respond to emails or phone calls.
The post Exclusive: Former Meta and OpenAI Contractor Sama Liquidates, Citing Lawsuits appeared first on TIME.
