This article continues Ice Miller’s reporting on the progress of SB2979, which amends the Illinois Biometric Information Privacy Act (BIPA) ¹ to provide that the statutory damages allowed under BIPA are generally limited to a single award of statutory damages as opposed to multiple awards of statutory damages for each time biometric identifiers or information are collected or distributed in violation of BIPA. As discussed in our prior articles (See: 4/12/24 Article), in Cothron, ² The Illinois Supreme Court interpreted BIPA to mean that a separate violation of BIPA occurs each time biometric information or identifiers are collected in violation of the Act. For example, each time an employee is required to clock in or out for work using a biometric time clock that requires a finger scan, without the employer complying with BIPA, would be a separate violation for which the employee could recover a separate award of $1,000. If an employee clocked in and out four times per day, this would mean $4,000 in statutory damages per day, $20,000 per week, and $1 million per year.

After making the determination that BIPA as written allows for recovery of statutory damages for each violation, the Illinois Supreme Court suggested that the legislature should review the public policy concerns associated with the statutory damages allowed under BIPA, as there was nothing in the Act to suggest that the legislature intended that BIPA would result in the financial destruction of a business. SB2979 was introduced in response to the Supreme Court’s suggestion in Cothron. The bill was passed by the Illinois Senate on April 11, 2024, and sent to the Illinois House, where it was assigned to the House Judiciary-Civil Committee.

On May 1, 2024, the Illinois House Judiciary-Civil Committee held a Committee hearing to consider SB2979. The bill passed the Committee along partisan lines (10-5-0) with the Republican members of the Committee voting against the bill, expressing the belief that the bill did not go far enough in reforming BIPA. The bill now goes to the House floor for second reading. Republican Committee Spokesperson Rep. Dan Ugaste (R-65) led the opposition to the bill, expressing the belief that the bill does not go far enough in reforming BIPA and stating that he is aware the Illinois has lost potential data center projects due to BIPA. Steve Schroeder, the founder and President of Creative Werks, LLC, a small co-packing and manufacturing company that has its headquarters in Elk Grove Village, testified live before the Committee urging it to go farther in reforming BIPA and suggesting that the legislature specifically provide that the bill would have retroactive effect and would apply to all pending cases.

Schroeder testified that his company was hit with a BIPA class action ³ and that the company’s attorneys and insurers advised him that the legislature would reform BIPA and that he should wait for the legislature to do so before taking action to resolve his case. Creative Werks was hit with a BIPA class action filed on February 1, 2019, alleging that the company violated BIPA, as it required employees to use a biometric timeclock to clock in and out of work using a finger scan without obtaining the employees’ consent. Creative Werks filed a motion to dismiss the amended complaint that was denied by the court on February 10, 2020. Creative Werks then filed a motion requesting the trial court to certify to the Illinois Supreme Court the question of what the appropriate statute of limitations is for a BIPA claim. The company then later withdrew its motion and entered into an agreed order on July 15, 2020, to stay the case against it, pending the Illinois Supreme Court’s decision in Tims, ⁴ in which the issue of what the appropriate statute of limitations is for BIPA was before the Illinois Supreme Court.

On February 12, 2023, the Illinois Supreme Court issued its decision in Tims, ⁵ holding that the statute of limitations for a BIPA claim was five years. On April 6, 2023, the stay was lifted in the Creative Werks case and the case is moving forward. Creative Werks is now facing the potential annihilative damages of $1,000 for each time an employee clocked in or out.

Mr. Schroeder eloquently testified on behalf of his company and other small businesses in Illinois, urging the Committee to make SB2927 retroactive to provide some relief to small businesses. He testified that BIPA is an “iPhone 2 law attempting to regulate an iPhone 15 world.” Schroeder stated that his competitors in every other state are free from the crushing effect of BIPA, and while he has been committed to doing business in Illinois, BIPA has caused him to have second thoughts. He noted that the plaintiffs in the thousands of BIPA cases filed did not sustain any actual harm. Schroeder urged the Legislature to consider “more robust reform” to remedy the abuse of BIPA.

Rep. Ann M. Williams (D-11), who is the Vice Chair of the Illinois House Judiciary Committee and the primary sponsor of SB2979 in the House, summarized the position of supporters of the bill, that BIPA is an important safeguard and, while additional work may be required in the future, the bill should be passed now as is. Rep. Williams also noted that Crain’s Chicago Business had reported that morning that White Castle had settled the Cothron case for $9.4 million, which was a fraction of the potential $17 billion in statutory damages it faced, implying that the limits on statutory damages under SB2979 are appropriate.

Committee members questioned whether SB2979 would be retroactive and Rep. Williams and Rep. Dan Didech (D-59) both indicated that the bill is not retroactive, but that courts were free to look at the legislative intent of enacting SB2979 in deciding what the appropriate damages to be awarded are, noting that the Illinois Supreme Court in Cothron also noted that the statutory damages of $1,000 per violation need not be awarded and that a lesser amount could be awarded. Rep. Ugaste retorted that the fact that a court may award less than the statutory damages provides little comfort when negotiating with a plaintiff class action attorney in an attempt to settle a case.

SB2979 will now go to the House floor for second reading. The legislative sausage-making process will continue and it is possible that floor amendments could be made to the bill, but it appears that the Senate and House leadership are intent on passing the bill in its current state. Any House amendments to the bill would have to be approved by the Senate. It appears BIPA reform in the form of SB2979 will be coming by the end of May 2024. But remember—it ain’t over ‘til it’s over.

Bart Murphy is a Litigation partner in the Chicago office of Ice Miller LLP, where he defends companies in class action litigation including BIPA, GIPA, TCPA, and other consumer class actions. 

[1] 740 ILCS 14/1 et seq.
[2] Cothron v. White Castle System, Inc., 2013 IL 128004 (2023).
[3] Leon Brown et al, v. Creative Werks, LLC, No. 2019 CH 02230 (Cook County, IL). 
[4] Tims v. Black Horse Carriers, Inc., 2023 IL 127801 (2023). 
[5] Id.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.