After Illinois BIPA Amendment, Confusion Lingers Until Higher Courts Rule

“We have courts deciding both ways in the federal district,” said privacy attorney Peter Berk of Clark Hill. “Unless something goes to the 7th [U.S. Circuit Court of Appeals], there won’t be clear guidance. The only other path to clarification is if the issue percolates up in the appellate courts of Illinois, which takes time.”

Illinois passed BIPA in 2008, prompted by the company Pay By Touch going bankrupt, noted BlankRome biometric privacy lawyer Jeff Rosenthal. As a part of its business, Pay By Touch obtained customers' fingerprints, he said, and there was concern that if the company was sold, the new owner would possess that biometric data without the consumer’s consent.

“The reaction from the legislature in 2008 was, ‘Let's regulate the collection of biometric information, as well as biometric identifiers,’ which are two separate defined terms of the statute,” Rosenthal said. Though biometrics was not yet a burgeoning technology, the concern was there, as was the need for legislation, he said.

“The legislature was clear" that they were not prohibiting use of biometric technology, "in fact, the exact opposite,” Rosenthal said. “The goal of all of these laws is to encourage confidence in the populace, so all of us feel more comfortable giving over biometric data.” The key about biometrics, he said, is that they are immutable, and are therefore very valuable in the event of a bad actor possessing the data.

Immediately after BIPA passed, it was relatively quiet on the litigation front, Rosenthal said. That was until 2019 with the case Rosenbach v. Six Flags Entertainment Corp., where the Illinois Supreme Court ruled that a plaintiff does not have to show actual harm to bring a BIPA case. “All of a sudden, the floodgates really opened up, because now that pretty core defense was taken off the table,” said Rosenthal. “It was a snowball effect ... more cases [were] filed, more larger cases, more settlements, more dollars, more cases. You could see the cycle just repeating itself.”

The Illinois Supreme Court made two more decisions that further clarified BIPA’s extent. It ruled that BIPA has a five-year statute of limitations in the 2023 Tims v. Black Horse Carriers, Inc. case, Rosenthal said. In Cothron v. White Castle that same year, the court ruled that BIPA as written fell under the per scan theory, meaning every use of biometrics without consent counted as a violation. However, the justices invited the legislature to clarify its intent at the end of their opinion, he said.

“They recognized there was a potential ambiguity in the way that BIPA was originally drafted,” said Rachel Schaller, another lawyer at BlankRome. The court “was unsure whether the Illinois legislature actually intended for statutory damages, liquidated damages, to be assessed every single time someone places their hand on a scanning device.”

The legislature clarified in a June 2024 amendment to BIPA that it intended for plaintiffs to get a single amount of damages in any instance where their biometric information is collected, but not multiple damages if their biometrics are collected in the same way for the same person, Schaller said.

The fight that’s now playing out is whether this amendment can apply retroactively, she said. “We have made the argument in several cases that the amendment should be applied retroactively,” Schaller said. "Amendments which are not expressly retroactive, on their face, should be applied retroactively when they merely clarify legislative intent regarding the original enactment.”

Based on House and Senate floor discussions from the 2024 legislative session, Schaller said the prevailing view is that the legislature intended for the amendment to apply retroactively. But “it’s playing out in the courts right now,” she said. “There's a different path that this argument is developing on, depending on which jurisdiction the arguments are being raised,” and ultimately “we expect these issues are going to work their way off the appellate court system and likely to the Illinois Supreme Court, since it is such an important issue and there is a lot of money at stake.”

In November, Judge Elaine Bucklo of the U.S. District Court for Northern Illinois ruled in the case Gregg v. Central Transport LLC that the amendment applied retroactively. But since that decision, other courts have ruled the opposite way, such as in Schwartz v. Supply Network, Inc.,also decided in November.

“It's still a developing issue,” said Madison Shepley, attorney at Clark Hill. “There will be more courts that make decisions. And as you can see [from the cases noted], the courts can decide to agree with other judges in their district or disagree.”

But waiting for the question to make it to the Supreme Court means there is confusion for now, she said. “It further means uncertainty for an indefinite period of time, which is hard for those cases that were filed prior to August 2, 2024,” said Shepley. “Given the applicable statute of limitations, that could mean potential uncertainty for several years.”

As a result, “it's going to heavily impact the cases filed before the amendment that are still pending,” said Berk. “The defendants now have an argument that this was a clarification of the law, and therefore it applies retroactively to cases filed before the amendment took effect.”

When it comes to the amount of litigation, “I don't think the retroactivity decision necessarily moves the needle that much on how much litigation is filed; I think the amendment itself does that,” said Berk. “The retroactivity decision will have the greatest impact on the cases that are currently pending, where companies are discussing settlement or ways to dismiss cases. That’s where this fight is going to happen and have the most effect.”

“At this point, it's an exposure assessment,” said Shepley. “It's directly impacting cases that have already been filed, so not necessarily prospective, but looking back.” This means as we move further from the amendment date, the number of cases “will necessarily dwindle,” said Berk. “We’re going to get to the point where all the cases filed are after the amendment.”

There may be a shift in how BIPA is used in terms of litigation, and what cases it's used in, Berk said. The more interesting questions are: “What is the next phase in the use of litigation? Will we see a shift in the types of actions filed, the parties involved, or the defendants targeted? Will the statute be applied in new ways or expanded to different types of cases that haven’t been explored yet?”

Shepley said another question is, “So what now, while everything's pending?” She added, “What do you say to clients or advise businesses who are currently hit and may be considering settlement?”