The Class Action Weekly Wire – Episode 41: BIPA Health Care Exception Embraced By Illinois Supreme Court

Duane Morris Takeaway:
This week’s episode of the Class Action Weekly Wire features Duane Morris partner Jerry Maatman and associate Tyler Zmick with their discussion of an Illinois Supreme Court ruling that is welcome news for BIPA defendants and companies operating in the health care space.

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 Episode Transcript

Jerry Maatman: Thank you loyal blog readers and listeners, welcome to this week’s installment of the Class Action. Weekly Wire. Joining me today is my colleague, Tyler Zmick, here at Duane Morris.

Tyler Zmick: Thanks, Jerry. Great to be here.

Jerry: Today we’re discussing the most recent decision of the Illinois Supreme Court in Mosby v. Ingalls Memorial Hospital, a decision by the high court regarding exemptions under the BIPA statute – which is the source of so much class action litigation here in Illinois. Tyler, you’re one of the foremost thought leaders in this particular space – what’s your read on this particular decision?

Tyler: Sure, well I think it’s a significant and rare defendant-friendly ruling. And this exception at issue in the case could be potentially pretty broad and could be a basis for defendants to assert viable defenses in cases that are sort of less obviously involving or related to healthcare than this specific Mosby case.

But with respect to this case that went before the Illinois Supreme Court – the plaintiffs were nurses, and the hospitals they worked at required them to use a fingerprint-based medication dispensing system. So basically, the nurses had to scan their fingerprints to verify their identities, and the system would then give them access to controlled medicines which the nurses would then give to their patients. So, the plaintiffs sued the hospitals they worked for, in addition to the company that sold the medication dispensing device, and they alleged that all the defendants violated the BIPA by using the device to collect their biometric finger scan data without complying with the BIPA statute’s notice and consent requirements.

In the trial court, the defendants moved to dismiss, and they did so on the basis that the claims failed because plaintiff’s’ data was excluded from the scope of the BIPA. And specifically § 10 of the statute states that “biometric identifiers do not include information captured from a patient in the health care setting or information collected for healthcare treatment, payment, or operations under HIPAA.” And, as we all know, HIPAA is the federal health privacy statute that applies in many circumstances, and is often cross-referenced in state statutes. So defendants argued that the latter clause regarding HIPAA applied, and that plaintiffs’ fingerprints had been used so that the nurses could provide medicine to treatments, meaning the fingerprints were collected for healthcare treatment under HIPAA, but the trial court denied the motions to dismiss, which led to the appeal – first the Appellate Court, and then to the Illinois Supreme Court.

Jerry: I thought that the trial court’s disposition of the exemption, as well as the discussion by the Illinois Appellate Court regarding the either narrow or broadness of that particular exemption, was very interesting. I know, in handling these sorts of cases, plaintiffs always argue that exemptions to liability should be construed very narrowly. But it seems like in this particular case, the Illinois Supreme Court ruled in a very practical and straightforward way. With respect to the exemption, what did you find interesting between the trial court, Appellate Court, and Supreme Court’s treatment of the exemption?

Tyler: That’s a good question. I think primarily the Appellate Court’s reading of the healthcare exception in the BIPA statute was less based on the plain language of the statute, and as we know, the first rule of statutory interpretation is, go with the plain language of the statute, and read every word, so nothing is superfluous. And that is what the Illinois Supreme Court did here, and also interestingly, what one of the three appellate court justices did – specifically Appellate Court Justice Mikva thought that the exception should be applied more broadly in the way the Illinois Supreme Court did end up interpreting it.

Jerry: I went to law school with Justice Mikva, a good friend and very well respected in the bar. Did you think that the dissent in terms of its interpretation, somewhat carried the day and swayed the Illinois Supreme Court in terms of the result that we saw here from the high court?

Tyler: Yes, absolutely. I mean in pretty much every respect the Illinois Supreme Court agreed with Justice Mikva’s dissent. The high court unanimously held that as Justice Mikva opined that the BIPA’s exclusion for information collected for healthcare treatment, payment, or operations under HIPAA can apply to the biometric data of healthcare workers, and not only patients. And obviously here we have plaintiffs that were nurses and thus healthcare workers.

Going to the specific analysis that was adopted by the Supreme Court and Appellate Court’s justice, the high court determined that the relevant sentence of § 10 excludes from the definition of biometric identifier data that may be collected in 2 separate and distinct scenarios rather than overlapping scenarios. Specifically, biometric identifiers do not include (i) information captured from a patient in a healthcare setting or (ii) information collected, used, or stored for healthcare treatment, payment, or operations under HIPAA. And the Supreme Court again agreed with defendants that the two categories are different, because the information excluded under the first clause originates only from the patient, whereas information excluded under the second clause may originate really from any source. And regarding that second HIPAA clause, the Supreme Court observed that the Illinois Legislature borrowed the phrase ‘healthcare treatment, payment, and operations’ from the federal HIPAA regulations, and it’s important to note that the federal HIPAA regulations in turn provide relatively broad definitions for those terms. So it remains to be seen just how broad the BIPA’s healthcare exception will be when applied in other future BIPA cases.

Jerry: Well, it seems to me this is a gem of a ruling, and one that defendants – both in and outside of the healthcare industry – should put in their toolbox as an additional line of defense to oppose efforts to certify classes or for plaintiffs’ lawyers prosecuting BIPA cases. So thank you very much for your analysis, Tyler, and for being our guest on this week’s Class Action Weekly Wire.

Tyler: Absolutely. Thanks for having me, Jerry.

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The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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