{"id":676,"date":"2023-07-20T07:58:20","date_gmt":"2023-07-20T11:58:20","guid":{"rendered":"https:\/\/blogs.duanemorris.com\/classactiondefense\/?p=676"},"modified":"2023-07-20T07:58:20","modified_gmt":"2023-07-20T11:58:20","slug":"illinois-supreme-court-refuses-to-reconsider-per-scan-bipa-accrual-ruling-in-cothron-v-white-castle","status":"publish","type":"post","link":"https:\/\/blogs.duanemorris.com\/classactiondefense\/2023\/07\/20\/illinois-supreme-court-refuses-to-reconsider-per-scan-bipa-accrual-ruling-in-cothron-v-white-castle\/","title":{"rendered":"Illinois Supreme Court Refuses To Reconsider \u201cPer-Scan\u201d BIPA Accrual Ruling In Cothron v. White Castle"},"content":{"rendered":"

\"\"<\/a>By Gerald L. Maatman, Jr. and Tyler Zmick<\/strong><\/p>\n

Duane Morris Takeaways:\u00a0\u00a0<\/em><\/strong>As<\/em> we<\/em> previously <\/em>blogged<\/em><\/a>, on February 17, 2023 the Illinois Supreme Court\u00a0held in Cothron v. White Castle<\/em>, <\/em>2023 IL 128004 (2023), that a separate claim for damages accrues under the Biometric Information Privacy Act (\u201cBIPA\u201d) each time a private entity scans or transmits an individual\u2019s biometric data in violation of Sections 15(b) or 15(d) of the statute.\u00a0 On July 18, 2023, the Illinois Supreme Court denied <\/a>White Castle\u2019s petition for hearing, resulting in the February 17<\/em> ruling becoming the final \u201claw of the land\u201d in Illinois.\u00a0 The Court\u2019s decision to deny White Castle\u2019s rehearing petition was not unanimous, however, as reflected by the blistering dissent penned by Justice Overstreet and joined by Chief Justice Theis and Justice Holder White. <\/em>For companies involved in BIPA class action litigation, the dissent is required reading, as it foreshadows an array of defense-oriented arguments over damages issues in privacy litigation.<\/em><\/p>\n

Illinois Supreme Court\u2019s Majority Decision In Cothron<\/em><\/strong><\/p>\n

In a 4-3 split ruling, the Illinois Supreme Court held on February 17, 2023 that a separate claim accrues under the BIPA each time a private entity scans or transmits an individual\u2019s biometric data in violation of Sections 15(b) or 15(d), respectively.<\/p>\n

Relying on the statute\u2019s plain language and the fact that the actions of \u201ccollecting\u201d and \u201cdisclosing\u201d biometric data can occur more than once, the Supreme Court agreed with Plaintiff\u2019s interpretation \u2013 namely, that Section 15(b) \u201capplies to every instance when a private entity collects biometric information without prior consent\u201d and that Section 15(d) \u201capplies to every transmission to a third party.\u201d\u00a0 Cothron<\/em>, 2023 IL 128004,\u00a0\u00b6\u00b6 19, 23, 28.\u00a0 The Supreme Court acknowledged that this interpretation \u2013 coupled with the statute allowing prevailing plaintiffs to recover up to $1,000 or $5,000 for each \u201cviolation\u201d \u2013 could lead to astronomical damages awards that may be \u201charsh, unjust, absurd or unwise,\u2019\u201d id.<\/em> \u00b6 40 (citation omitted), but noted that it must apply the statute as written and that policy-based concerns should be addressed by the Illinois legislature.<\/p>\n

Dissent To Majority\u2019s Decision To Deny White Castle\u2019s Rehearing Petition <\/strong><\/p>\n

On July 18, 2023 the Illinois Supreme Court denied White Castle\u2019s petition for rehearing in Cothron v. White Castle<\/em>, effectively leaving White Castle with no further avenues for challenging the ruling.<\/p>\n

Three Justices (the same three who dissented to the February 17 majority decision) disagreed with the decision to deny White Castle\u2019s petition for rehearing.\u00a0 In opining that the Supreme Court should have granted rehearing, the Dissent focused on three issues, including: (1) the majority\u2019s \u201cper scan\u201d theory of liability subverting the intent of the Illinois legislature; (2) the majority\u2019s \u201cper scan\u201d theory of liability threatening the survival of Illinois businesses and raising \u201csignificant constitutional due process concerns,\u201d id.<\/em> \u00b6 70; and (3) the majority\u2019s decision in failing to provide trial courts with criteria to use in exercising their discretion whether to award statutory damages for BIPA violations.<\/p>\n

First, the Dissent stated that the Illinois legislature meant for the BIPA to be a straightforward remedial statute that allows individuals to choose to provide (or not to provide) their biometric data after being informed that the data is being collected, stored, and potentially disclosed.\u00a0 The Dissent rejected the majority\u2019s \u201cflawed construction\u201d of the statute, which mistakenly presumes that the legislature meant for the BIPA to \u201cestablish a statutory landmine\u201d and \u201cdestroy commerce in its wake when negligently triggered.\u201d\u00a0 Id.<\/em> \u00b6 73; see also id.<\/em> (\u201cThe majority\u2019s construction of the [BIPA] does not give effect to the legislature\u2019s true intent but instead eviscerates the legislature’s remedial purpose of the [BIPA] and impermissibly recasts [it] as one that is penal in nature rather than remedial.\u201d).<\/p>\n

Second, the Dissent opined that by construing the statute to allow for awards of statutory damages that bear no relation to any actual monetary injury suffered, the majority\u2019s decision raises due process concerns that \u201craise doubt as to [the BIPA\u2019s] validity.\u201d\u00a0 Id.<\/em> \u00b6 74; see also id.<\/em> \u00b6 75 (\u201cThe legislature\u2019s authority to set a statutory penalty is limited by the requirements of due process.\u00a0 When a statute authorizes an award that is so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable, it does not further a legitimate government purpose, runs afoul of the due process clause, and is unconstitutional.\u201d).<\/p>\n

Finally, the Dissent took issue with the majority\u2019s refusal to clarify its February 17 holding with respect to the discretionary (rather than mandatory) nature of liquidated damages under the statute.\u00a0 Specifically, the Dissent noted that the majority opinion did not provide trial courts with standards or criteria to apply in determining whether to award statutory damages in a particular BIPA case and, if so, in what amount.\u00a0 The Dissent asserted that the Supreme Court should have agreed to clarify \u201cthat statutory damages awards must be no larger than necessary to serve the [BIPA\u2019s] remedial purposes\u201d and to \u201cexplain how lower courts should make that determination.\u201d\u00a0 Id.<\/em> \u00b6 85.\u00a0 Per the Dissent, \u201c[w]ithout any guidance regarding the standard for setting damages, defendants, in class actions especially, remain unable to assess their realistic potential exposure.\u201d\u00a0 Id.<\/em><\/p>\n

Implications For Corporat<\/strong>ions<\/strong><\/p>\n

Assuming White Castle cannot convince the U.S. Supreme Court to grant review of the Cothron<\/em> decision based on constitutional issues, Cothron<\/em> is now the final law of the land in Illinois.\u00a0 White Castle and other BIPA defendants may, however, attempt to raise constitutional challenges to the statute in other BIPA cases moving forward based on the same concerns expressed by the three dissenting Justices in Cothron<\/em>.<\/p>\n

The denial of White Castle\u2019s rehearing petition indicates that the well is beginning to dry for businesses in terms of potential BIPA defenses.\u00a0 While employers and other BIPA defendants can still explore novel defenses, such as the exception for information captured from a patient in a health care setting or challenges to personal jurisdiction, many companies caught in the crosshairs of BIPA class actions will face pressure to settle due to the risk of facing monumental potential damages.\u00a0 Moreover, attempts to reform the BIPA statute failed in 2023, and the Illinois legislature likely will not consider any further reform proposals until 2024.\u00a0 Given the bleak outlook of the law as it stands, it is imperative that businesses immediately ensure they are compliant with the BIPA.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Gerald L. Maatman, Jr. and Tyler Zmick Duane Morris Takeaways:\u00a0\u00a0As we previously blogged, on February 17, 2023 the Illinois Supreme Court\u00a0held in Cothron v. White Castle, 2023 IL 128004 (2023), that a separate claim for damages accrues under the Biometric Information Privacy Act (\u201cBIPA\u201d) each time a private entity scans or transmits an individual\u2019s … <\/p>\n

Continue reading “Illinois Supreme Court Refuses To Reconsider \u201cPer-Scan\u201d BIPA Accrual Ruling In Cothron v. White Castle”<\/span><\/a><\/p>\n","protected":false},"author":575,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[59],"tags":[],"ppma_author":[7,12],"class_list":["post-676","post","type-post","status-publish","format-standard","hentry","category-privacy-class-actions"],"authors":[{"term_id":7,"user_id":575,"is_guest":0,"slug":"gmaatman","display_name":"Gerald L. Maatman, Jr.","avatar_url":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-content\/uploads\/sites\/56\/2022\/09\/maatmangerald-100x100.jpg","0":null,"1":"","2":"","3":"","4":"","5":"","6":"","7":"","8":""},{"term_id":12,"user_id":578,"is_guest":0,"slug":"tzzmick","display_name":"Tyler Z. Zmick","avatar_url":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-content\/uploads\/sites\/56\/2022\/09\/zmicktyler-100x100.jpg","0":null,"1":"","2":"","3":"","4":"","5":"","6":"","7":"","8":""}],"_links":{"self":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/posts\/676","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/users\/575"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/comments?post=676"}],"version-history":[{"count":0,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/posts\/676\/revisions"}],"wp:attachment":[{"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/media?parent=676"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/categories?post=676"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/tags?post=676"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/blogs.duanemorris.com\/classactiondefense\/wp-json\/wp\/v2\/ppma_author?post=676"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}