On August 2, 2024, Illinois Governor J.B. Pritzker signed into law Senate Bill 2979 (the "Amendment"), implementing long-awaited, highly anticipated reform to the Illinois Biometric Information Privacy Act (BIPA). The Amendment is a milestone in the broader ongoing effort to resolve BIPA's vague statutory language and courts' expansive interpretations of the law, which have resulted in businesses across Illinois paying hundreds of millions of dollars to settle the 1,000+ BIPA class actions filed in state and federal courts to date. The Amendment will reduce the damages at issue in BIPA class action litigation, which should ultimately slow down BIPA class action litigation in Illinois. This article provides a summary of the Amendment and its anticipated impact on BIPA litigation.

What Does the Amendment Do?

The focus of the Amendment is a limitation on the number of violations an individual can accumulate under BIPA. Prior to the Amendment, employees who used biometric technology in the workplace could claim that a separate violation of BIPA occurred each time they used the biometric solution. For example, if an employee used a timeclock that scans a fingerprint, palm or iris without having previously executed a BIPA-compliant release, they could recover separate damages for each and every scan. Now, employees who file a BIPA lawsuit against their employer will be limited to one claim under each section of the statute. The Amendment is a direct response to the Illinois Supreme Court's ruling in Cothron v. White Castle Systems, 216 N.E.3d 918 (Ill. 2023), that each instance of unauthorized collection, storage, and/or use of biometric information without proper consent results in separate "per scan" damages. With the Amendment, multiple alleged collections of an individual’s biometric data constitute a single violation, limited to one recovery.

The Amendment also makes clear that individuals may execute a BIPA-compliant release using an electronic signature. This minor addition to BIPA is unlikely to change the compliance landscape for employers, however, as many already allowed employers to use electronic signatures to executive BIPA releases, pursuant to the Uniform Electronic Transactions Act.

How Will the Amendment Impact Ongoing BIPA Litigation?

Because the Amendment is silent on its applicability to currently-pending BIPA litigation, there is likely to be a battle over its retroactivity. The language of the Amendment does not expressly indicate an intent either way, but there are strong arguments for retroactivity based on Illinois law. Although Illinois law adopts a general presumption against retroactivity of statutory amendments, the Amendment impacts remedies - that is, damages - and therefore may be seen as procedural in nature, as opposed to substantive. Procedural amendments may be applied retroactively under Illinois law. These arguments will be tested at various phases of BIPA litigation - for example, as it relates to the appropriate scope of discovery - not just at the advanced stage where liability is established and damages may be awarded. However, the issue will likely require appellate review, up to and including the Illinois Supreme Court, before it is settled finally.

How Will the Amendment Impact Future BIPA Litigation?

Although BIPA claims have almost exclusively been litigated as class actions since approximately 2016, over the past year there has been a growing trend toward filing individual BIPA claims against employers. The value proposition for these single plaintiff BIPA claims is rooted in the prospect of a court awarding damages that penalizes the employer for each and every use of the biometric solution. So, if an employee used a timeclock that scanned their fingerprint 4 times a day for a year, the employer could be faced with a damage award of over $1M even for a single employee. The single plaintiff claims also present a nightmare scenario for employers: Instead of facing all the individuals for whom the employer failed to satisfy its BIPA compliance obligations in a single action, the employer is exposed to a multitude of single plaintiff claims. The Amendment makes single plaintiff litigation a much less lucrative proposition for plaintiffs.

The same is true for BIPA arbitrations. Once a means by which to fend off potential BIPA claimants, in recent years arbitration agreements have had little ability to stem the tide of single claimant BIPA claims being lodged against employers. The Amendment's impact on a claimants' ability to recover significant damages awards under BIPA may also decelerate single plaintiff arbitration filings.

Takeaways

• As a practical matter, the Amendment has the greatest impact on employers that may be accused of BIPA compliance violations in the future. The Amendment limits the possibility of employers facing astronomical damage awards in BIPA litigation, and in turn allows employers to realistically consider litigating BIPA actions through trial.

• Employers currently embroiled in BIPA litigation are in a holding pattern until a court rules on whether the Amendment has retroactive effect. However, the mere existence of the Amendment may serve as a point of leverage for employers exploring settlement of a BIPA class action.

• The legislature's validation of electronic signatures as a means by which to execute BIPA consent forms provides employers with significant latitude with respect to the rolling out of their BIPA compliance documents. Employers that use a human resource information system (HRIS) or a learning management system (LMS) to distribute notices to workforce members may now wish to consider loading their BIPA compliance documents into these systems.

Posted: August 8, 2024