BIPA

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In an important opinion, the Ninth Circuit affirmed a lower court’s ruling that plaintiffs in the ongoing Facebook biometric privacy class action have alleged a concrete injury-in-fact to confer Article III standing and that the class was properly certified. (Patel v. Facebook, Inc., No. 18-15982 (9th Cir. Aug. 8, 2019)). Given the California district court’s prior rulings which denied Facebook’s numerous motions to dismiss on procedural and substantive grounds, and the Illinois Supreme Court’s January 2019 blockbuster ruling in Rosenbach, which held that a person “aggrieved” by a violation of the Illinois Biometric Information Privacy Act (“BIPA”) need not allege some actual injury or harm beyond a procedural violation to have standing to bring an action under the statute, the Ninth Circuit’s decision was not entirely surprising. Still, the ruling is significant as a federal appeals court has ruled on important procedural issues in a BIPA action and found standing. The case will be sent back to the lower court with the prospect of a trial looming, and given BIPA’s statutory damage provisions, Facebook may be looking at a potential staggering damage award or substantial settlement.     

Last Friday, the Illinois Supreme Court ruled in the long-awaited Rosenbach case that an individual does not have to plead an actual injury or harm, apart from the statutory violation itself, in order to have statutory standing to sue under the Illinois Biometric Information Privacy Act (BIPA).  The Illinois Supreme Court ruling will allow procedural BIPA violations to proceed (and multiply) in state court – and has reportedly already prompted parties to settle such actions.  However, recent rulings in federal court have offered a divergent interpretation of the related, but different Article III standing issue.

In a long-awaited decision, the Illinois Supreme Court issued its ruling in Rosenbach v. Six Flags Entertainment Corp., 2019 IL 123186 (Ill. Jan. 25, 2019), on whether a person “aggrieved” by a violation of the Illinois Biometric Information Privacy Act (“BIPA”) must allege some actual injury or harm beyond a procedural violation to have standing to bring an action under the statute.  Since the Court took the appeal in May 2018, businesses have been waiting for the answer to this important question, as the robust wave of Illinois biometric privacy suits against Illinois-based employers and other businesses continued apace and several Illinois courts issued disparate interpretations about what it means to be “aggrieved” under the statute.

In a disappointment to many of the defendants in pending cases, a unanimous Court in Rosenbach reversed the appellate court and ruled that an individual does not have to plead an actual injury or harm, apart from the statutory violation itself, in order to have standing to sue under BIPA. The outcome was not a complete surprise, as previous courts (such as a California federal court and an Illinois appellate court) had ruled or expressed in dicta that mere technical violations of BIPA were sufficient under the statute.

Last December, we noted the continuing robust wave of Illinois biometric privacy suits.  At that time, dozens of suits had been filed in Illinois state court against Illinois-based employers and other businesses alleging violation of Illinois’s Biometric Information Privacy Act (BIPA), which generally regulates the collection, retention, and disclosure of personal biometric identifiers and biometric information, and encourages businesses that collect such personal data to employ reasonable safeguards.  More and more BIPA actions against employers and businesses based upon alleged violations of the notice and consent provisions of the statute continue to be filed, even as the Illinois Supreme Court considers the appeal of the Rosenbach decision.  In that case, the Illinois Supreme Court will presumably answer the question of whether a person “aggrieved” by a violation of BIPA must allege some injury or harm beyond a procedural violation.  The ruling will certainly have an effect on the pending lawsuits alleging mere procedural BIPA violations.

Late last month, an Illinois appellate court reversed a lower court’s dismissal of biometric privacy claims against a tanning salon franchisee that had collected the plaintiff’s fingerprint to allow entry in its own salon and any L.A. Tan salon location nationwide.  (Sekura v. Krishna Schaumburg Tan, Inc., 2018 IL App (1st) 180175 (Ill. App. Sept. 28, 2018)).  The plaintiff alleged that the tanning salon violated the Biometric Information Privacy Act (BIPA), which regulates the collection, retention, and disclosure of personal biometric identifiers and biometric information, by collecting her fingerprints without obtaining the required written release and providing the required disclosure concerning its retention policy, and further by disclosing her fingerprints to a third-party vendor. [Note: In 2016, in a separate suit, the same plaintiff settled BIPA claims with L.A. Tan Enterprises, Inc., operator (directly and through franchisees) of L.A. Tan tanning salons].

An Illinois district court remanded to state court for lack of standing a biometric privacy suit brought by employees over the collection and storage of individuals’ fingerprints allegedly in violation of the Illinois Biometric Information Privacy Act, 740 ILCS 14/1 (“BIPA”). (Aguilar v. Rexnord, LLC, No. 17 CV 9019 (N.D. Ill. July 3, 2018)).  This decision echoes other recent rulings where federal courts have found a lack of Article III standing in disputes where employees claimed procedural violations of BIPA over the knowing collection of fingerprints for timekeeping purposes, absent any claims of wrongful sharing or disclosure.  See e.g., Howe v. Speedway LLC, No. 17-07303 (N.D. Ill. May 31, 2018) (even if failing to provide certain disclosures and obtain his written authorization prior to collecting and storing plaintiff’s fingerprints may constitute a violation of BIPA, such procedural violations did not cause an injury in fact where the employee was aware of the nature and purpose of collection); Goings v. UGN, Inc., No. 17-9340 (N.D. Ill. June 13, 2018) (remanding BIPA claims for lack of Article III standing because claims were too abstract and employee was aware he was providing fingerprint data to his employers and did not claim any non-consensual disclosure of such data). 

Last December, an Illinois appellate court, in the Rosenbach v. Six Flags decision (2017 IL App (2d) 170317 (Dec. 21, 2017)), dismissed biometric privacy claims lodged against theme park operators for collecting fingerprints to authenticate season-pass holders allegedly in violation of the notice and consent provisions of Illinois’s Biometric Information Privacy Act (BIPA), which regulates the collection, retention, and disclosure of personal biometric identifiers and biometric information.  BIPA expressly provides that “any person aggrieved by a violation” of the BIPA may pursue money damages and injunctive relief against the offending party.  In interpreting what “aggrieved” means under BIPA, the Rosenbach court ruled that a “person aggrieved by a violation of [the] Act” must allege some harm (“[A] plaintiff who alleges only a technical violation of the statute without alleging some injury or adverse effect is not an aggrieved person under…the Act”).  While federal courts have weighed in on whether litigants have Article III standing when asserting mere procedural violations of BIPA’s consent and data retention requirements, it was not clear if such procedural violations, without any showing of harm or data misuse, were actionable under the statute.  Rosenbach was the first time an Illinois appellate court weighed in on the meaning of an “aggrieved” party under BIPA.

Following Rosenbach, we speculated whether the decision would curb the wave of BIPA class actions asserting procedural violations filed against employers and businesses that used biometrics to authenticate employees or customers; the answer to that question remains in flux, with subsequent rulings falling both ways.  For example, at least two Illinois trial courts followed Rosenbach in dismissing BIPA claims, though without intensive analysis of the issue. See: Rottner v. Palm Beach Tan, Inc., No. 15-CH-16695 (Ill. Cir. Ct. Mar. 2, 2018) (bound by Rosenbach‘s holding that neither liquidated damages nor injunctive relief is authorized under BIPA when the only injury alleged is a statutory violation; court stated that plaintiff allowed defendants to scan her fingerprint and there had been no publication of plaintiffs private information to sustain injury to a privacy right); Sekura v. Krishna Schaumburg Tan, Inc., No. 16-CH-04945 (Ill. Cir. Ct. Jan. 16, 2018) (brief order dismissing claims “[f]or the reasons outlined in Rosenbach”) (on appeal).

However, the recent California district court ruling in the Facebook biometric privacy litigation parted company with a reading of Rosenbach that would require a litigant to show an “actual” injury beyond the invasion of privacy rights outlined under BIPA and instead ruled that the plaintiffs had “sufficiently alleged” an intangible injury to a privacy right to be “aggrieved” under BIPA. It should be noted that the California court did look differently at Rosenbach and other cases involving voluntary fingerprinting where individuals knew that their biometric data would be collected before they accepted services as opposed to the social media photo tagging situation where such plaintiffs allege that they were not put on adequate notice that biometric data could be collected from uploaded photos.

This past month, in a notable ruling, an Illinois district court followed Rosenbach yet still declined to dismiss a suit brought by a former employee who asserted BIPA and negligence claims, among others, against a senior living center (“Defendant” or “Smith”) and its time clock vendor over the scanning of her fingerprints onto an employee biometric timekeeping device. (Dixon v. The Washington and Jane Smith Community – Beverly, No. 17-8033 (N.D. Ill. May 31, 2018)).  Specifically, the complaint alleged that Smith required new employees to have their fingerprints scanned by the defendant Kronos’s fingerprint scanner and entered into a database so employees could be authenticated when clocking in and out.  According to the plaintiff, Smith, among other things, failed to give adequate notice or obtain written consent before colleting her fingerprints, or post a biometric data retention policy.  Moreover – and really the allegation that pushed the complaint over the line – plaintiff claimed that, in addition to collecting and storing her biometric information, Smith also “systematically disclosed” that information to Kronos, the out-of-state, third-party vendor of Smith’s biometric time clocks, without informing her that it was doing so.

As discussed in past posts about the long-running Facebook biometric privacy class action, users are challenging Facebook’s “Tag Suggestions” program, which scans for and identifies people in uploaded photographs for photo tagging. The class alleges that Facebook collected and stored their biometric data without prior notice or consent in violation of the Illinois Biometric Information Privacy Act (BIPA), 740 Ill. Comp. Stat. 14/1 et seq.  While other technology companies face BIPA actions over photo tagging functions, In Re Facebook is the headliner of sorts for BIPA litigation, being the most closely-watched and fully-litigated.

There have been a host of new developments in this case as the parties continued to joust when the prospect of a trial was looming.  Earlier this month, a California district court denied both parties’ motions for summary judgment and found that a “multitude of factual disputes” barred judgment as a matter of law for either side.   (In re Facebook Biometric Information Privacy Litig., No. 15-03747 (N.D. Cal. May 14, 2018)).  The court’s prior orders over the past several years provide the context for the denial of summary judgment and the court’s refusal to revisit procedural rulings. See: In re Facebook Biometric Info. Privacy Litig., 185 F. Supp. 3d 1155 (N.D. Cal. 2016) (declining to enforce California choice of law provision in user agreement and applying Illinois law and refusing to find that the text of BIPA excludes from its scope all information involving photographs); Patel v. Facebook Inc., 290 F. Supp. 3d 948 (N.D. Cal. 2018) (declining to dismiss based on lack of Article III standing); In re Facebook Biometric Info. Privacy Litig., No. 15-03747, 2018 WL 1794295 (N.D. Cal. Apr. 16, 2018) (certifying Illinois user class and refusing Facebook’s renewed arguments to dismiss on procedural grounds).