This Tuesday Google settled a lawsuit that accused it of scooping data from unprotected WiFi networks as a part of its Street View mapping initiative, which was banned in Germany and a few other countries for fear that it would violate the privacy of citizens.

The case was brought by 38 states after it became public knowledge that Google Maps Camera Cars were doing more than just taking pictures on the road.  The company secretly collected passwords, medical records and everything else that its modified Subaru vechiles could extract from the unencrypted WiFi networks of unsuspecting households.

Google agreed to pay a $7 million fine, and signed a settlement that requires it to set up a privacy program within six months. The company must hold an annual privacy week event for employees (management blamed the scandal on a rogue employee), and it must implement privacy certification programs for selected individuals.

The search giant also agreed to create a video tutorial that explains how to encrypt one’s network and post educational ads in major newspapers.  The settlement raises questions about other aspects of Google’s business, such as the upcoming Project Glass. The New York Times quoted consultant Scott Cleland as saying:

“If you use Google Glass to record a couple whispering to each other in Starbucks, have you violated their privacy?” he asked. “Well, 38 states just said they have a problem with the unauthorized collection of people’s data.”

And there will undoubtedly be challenges in the future. Last week the company disclosed the number of data requests made by the FBI, which does not require a warrant to issue demand letters when citing national security concerns.