By Rosa M. Tumialán and Alyssa Vranak
Following the passage of Public Act 103-0769 (the “Act”) on August 2, 2024, it was anticipated that the amendment to 740 ILCS 14, the Biometric Information Privacy Act (“BIPA”), would apply retroactively and would start to curtail the ruinous damages to which defendants were exposed pre-amendment. This was the exact conclusion reached on November 13, 2024, where a federal district court for the Northern District of Illinois restricted the plaintiff’s recovery to the initial scan in John Gregg v. Central Transport, LLC, No. 24 C 1925, 2024 WL 4766297 (N.D. Ill. Nov. 13, 2024). The decision, issued by the Honorable Elaine E. Bucklo, granted the defendant’s motion to dismiss for lack of subject jurisdiction because the plaintiff could not satisfy the jurisdictional $75,000 amount in controversy for federal diversity jurisdiction. The Central Transport court acknowledged that “there is a presumption that statutory amendments are ‘intended to change existing law’ unless “the legislature intended merely to interpret or clarify the original act.” The court recognized that the legislature expressly adopted the Act to “make clear its intent regarding the assessment of damages under the Act,” which evidences some ambiguity as to a damages award under BIPA. The legislature’s intent to “clarify” the issue of damages under BIPA solidified the legislature’s intent, prompting the court to apply the amendment retroactively. This conclusion meant that the plaintiff could not satisfy the $75,000 jurisdictional amount to invoke diversity jurisdiction because he could only recover, at most, one liquidated damages award for the alleged section 15(b) and (d) claims, and a single recovery for the alleged section 15(a) claims under BIPA. This ruling opened the door to limiting the extent of damages recoverable under BIPA and potentially limiting the number of BIPA cases that could be filed in federal court.
But barely a week later on November 22, 2024, another federal district court reached the opposite conclusion in Jeffrey Schwartz v. Supply Network, Inc., d/b/a/ Viking SupplyNet, Case No. 1:2023cv14319. The Schwartz court disagreed with Central Transport, framing the question as whether the statute was ambiguous itself. The Schwartz court found that the Illinois Supreme Court found that the statutory language in BIPA was clear, which meant that the amendment was a change and not a clarification. It did not take much for the court to then conclude that the change to BIPA did not apply retroactively. The court noted that, among other things, the legislature could have stated its intent for retroactivity (“[n]othing in the text of the amendment indicates that it is merely clarifying the act, even though the legislature can expressly indicate its intent to clarify in the statutory text.”) The court also discounted “public statements by a handful of individual lawmakers” as insufficient to demonstrate the legislature’s intent for the amendment to apply retroactively. This, coupled with the court’s view that the amendment changed the extent of a plaintiff’s injury (i.e. more than a thousand to just one), led the court to find that the $75,000 jurisdictional amount was satisfied.
The Central Transport and Schwartz decisions, coming days apart, are the latest example of the lack of uniformity in federal court decisions interpreting and applying BIPA. This latest debate can be added to the growing list of questions that need resolution by an Illinois state court. But federal courts in the Seventh Circuit have already demonstrated a penchant for departing from Illinois state appellate court opinions with which they do not agree – cue the debate over whether the Illinois Appellate Court’s ruling in Visual Pak controls over the Wynndalco opinion.
There is no settled answer on whether the BIPA amendment prompted by Cothron applies retroactively, which is arguably exactly what the legislature intended to accomplish when it responded to the Illinois Supreme Court’s invitation to clarify the application of BIPA.
About the Authors
Rosa M. Tumialán
Rosa is a partner and Co-Chair of Tressler’s Insurance Practice Group, Chair of the Appellate Team and a member of the firm’s national Diversity, Equity and Inclusion Committee. Rosa focuses her practice on insurance coverage and litigation. She is an accomplished defense attorney with more than twenty years of experience. Rosa’s insurer-related services include coverage opinion analysis and representing insurers in complex coverage disputes relating to personal and commercial lines, third party claims, surplus lines as well as claims handling practices and extracontractual liability. She has also litigated environmental coverage disputes throughout the Midwest for various insurers relating to superfund sites. Rosa assists with drafting coverage documents for insurance pools and counsels clients in the administration of same. Her practice also includes serving as national coordinating coverage counsel for insurance clients who rely on her to develop and implement strategies nationwide in response to pattern litigation. Rosa is an accomplished class action defense lawyer and appellate practitioner, having appeared and argued in both state and federal courts nationwide.
Alyssa Vranak
Alyssa is an associate attorney in the Insurance Services Practice Group. She focuses her practice on insurance coverage analysis and litigation. Alyssa provides comprehensive coverage analysis and defense in matters involving a wide range of policies, including commercial general liability coverage and professional liability coverage.