Dirksen Federal Courthouse, Chicago
CHICAGO - A federal judge has given railroad Union Pacific the green light to ask a federal appeals court to decide if changes reducing the financial sting from Illinois’ stringent biometrics privacy law should be applied to lawsuits filed before state lawmakers changed the law.
In the case docketed as Clay v. Union Pacific, Alexakis had already denied the railroad’s motion for judgment in their favor on that question, concluding an amendment that took effect in August 2024 was not retroactive.
However, she nonetheless granted UP’s request to certify that decision for so-called “interlocutory appeal.”
Since 2015, lawyers have lodged thousands of class actions and other lawsuits against employers and businesses over alleged violations of the Illinois Biometric Information Privacy Act that neither required a showing of financial loss due to identity theft nor limited the fine exposure to one instigating incident.
In May 2024 the General Assembly approved Senate Bill 2979 to clarify that BIPA applies its statutory damages provisions on a per person basis, and not per scan of people's fingerprints, faces, voices or other so-called biometric identifiers.
Before state lawmakers changed the law, the Illinois Supreme Court had ruled the law should be interpreted to allow plaintiffs to demand $1,000-$5,000 per biometric scan.
Dissenting judges and business groups said that reasoning would expose businesses to “astronomical” and “annihilative damages” for technical violations of the law.
Some businesses faced the potential for thousands of exposures in allegations linked to fingerprint time clocks and point-of-sale systems or facial recognition technology used to provide access to secure areas. The lawsuits typically accused businesses of requiring the collection and consistent use of biometric identifier from employers or customers without first obtaining written consent or providing notices about how that information might be stored, used, shared and ultimately destroyed.
Clay, a truck driver, sued Union Pacific in April 2024, alleging he wasn’t told what would be done with the fingerprint scan he had to supply to bring his truck into secured UP rail yards. UP removed the complaint to federal court the next month, right about the time the Illinois House passed SB 2979, but months before Gov. JB Pritzker signed it into law.
Union Pacific asserted Clay’s damage claims should be tossed out, because they said the law should now be read to apply to all cases ever filed under the BIPA law, not just those filed after Pritzker signed the measure. They asserted that lawmakers believed that was always the correct way to read the law.
Clay and his lawyers opposed sending the question to the Seventh Circuit on appeal. They questioned whether UP’s certification request is timely — although there is no fixed deadline written into law — and if the legal question is contestable.
Alexakis disagreed that UP was untimely in waiting less than a month after she had denied their motion for judgment, to seek permission for interlocutory appeal.
“The court does not consider 28 days to be unreasonable in preparing a motion to certify for interlocutory appeal a novel question of state law, especially when Clay points to no prejudice he suffered as a result,” she wrote, adding that “Although the court shares Clay’s view that its April 10 order was ‘correctly reasoned, its confidence does not mean that BIPA retroactivity is not ‘contestable.’ ”
UP’s case is not the only one in which defendants have asserted the BIPA changes should be applied retroactively.
Initially, judges were divided on the question, but appear to have come around to side with plaintiffs’ lawyers, who argue the BIPA law’s lack of any statement explicitly making the law retroactive means it shouldn’t be considered retroactive.
While Alexakis said judges in Illinois federal and state courts have found BIPA changes aren’t applicable to cases filed before the amendment became law, she conceded the Seventh Circuit may have a difference of opinion.
Pointing to “the novelty and complexity of the legal issue,” Alexakis said the railroad “meets all four statutory criteria for an interlocutory appeal, as well as the ‘nonstatutory’ timeliness requirement.”
Any decision from the Seventh Circuit Court of Appeals would have far-reaching impact for Illinois businesses, with at least hundreds of BIPA class actions still pending in Cook County Circuit Court and other state and federal courts, with potentially many millions or even billions of dollars at stake.
The Seventh Circuit, however, may ultimately not take up the question themselves, at all, but could instead send the question over to the Illinois Supreme Court to answer as the ultimate decider on how to interpret Illinois state laws.
Clay is represented in the action by attorneys Daniel A. Edelman, Dulijaza (Julie) Clark and Alexandra Huzyk, of the firm of Edelman Combs Latturner & Goodwin, of Chicago.
UP is represented in the case by attorneys Sean M. Berkowitz, Gary Feinerman and Johanna Spellman, of Latham & Watkins, of Chicago.
