Rumors are flying this morning that Riya (a killer photo facial recognition startup) has been or is being acquired by Google in the $40 million range. See Om Malik, Niall Kennedy and Paul Kedrosky.

Even though everyone is blogging about it, this is nothing more than a rumor at this point. It is a rumor, however, that has been confirmed to me by employees of companies that were also apparently in the hunt for Riya but dropped out after the price became too rich.

These rumors will certainly make Riya’s launch party at my house tomorrow night even more interesting.

I want to stress that even though I know the Riya folks and even though I am hosting their launch party, I have no direct confirmation of the deal from them (and yes, I’ve tried). They are silent on this, which is understandable whether the rumor is accurate or not.

I tested Riya last month and came away very impressed. See my profile here. Riya has solid technology and an impressive team.