Seventh Circuit Sends Question about BIPA Claim Accrual to Illinois Supreme Court

Recently the U.S. Court of Appeals for the Seventh Circuit issued a much-anticipated decision in Cothron v. White Castle, concerning whether claims asserted under Sections 15(b) and 15(d) of the Illinois Biometric Information Protection Act (“BIPA”) accrue only once upon the initial collection or disclosure of biometric information or whether a new claim accrues each time biometric information is collected or disclosed. In lieu of answering the question, however, the Seventh Circuit punted the question to the Illinois Supreme Court at the plaintiff’s request.

The plaintiff, a manager at a White Castle restaurant, alleged that the restaurant chain introduced a system that required employees to scan their fingerprints to access pay stubs and work computers. The plaintiff alleged that each scan is sent to a third-party vendor that authenticates it and gives the employee access to the restaurant’s computer system. The plaintiff alleged that based on its use of that system, White Castle violated Sections 15(b) and 15(d) of the BIPA.

Under Section 15(b), a private entity may not “collect, capture, purchase, receive through trade, or otherwise obtain” a person’s biometric data without first providing notice to and receiving consent from the person. Under Section 15(d), a private entity may not “disclose, redisclose, or otherwise disseminate” biometric data without consent of the owner of the biometric data. The plaintiff brought suit not only individually but on behalf of a class of other White Castle employees.

White Castle defended against the lawsuit by seeking judgment on the pleadings. In support of its motion, the company argued that the claims were untimely since they accrued in 2008 when the plaintiff’s first fingerprint scan occurred after the BIPA came into effect. The plaintiff responded that every unauthorized collection or disclosure of biometric data constituted a separate violation of the statute, meaning a new claim accrued with each fingerprint scan. This meant, the plaintiff argued, that each scan started the clock on its own limitations period. The distinction is no small issue as the BIPA allows a successful plaintiff to recover the greater of actual damages or statutory damages of $1,000 for each negligent violation and $5,000 for each reckless or willful violation. The District Court ultimately denied White Castle’s motion but thought the issue important enough to warrant an interlocutory appeal.

On appeal, the plaintiff asked the Seventh Circuit to certify the question to the Illinois Supreme Court for response. The Court obliged the plaintiff and certified the following question to the Illinois Supreme Court for response: “Do section 15(b) and 15(d) claims accrue each time a private entity scans a person’s biometric identifier and each time a private entity transmits such a scan to a third party, respectively, or only upon the first scan and first transmission?”

In considering the parties’ arguments on claim accrual, the Court framed the issue as whether the BIPA should be treated like a junk-fax statute for which a claim accrues for each unsolicited fax or instead like certain privacy and reputational torts that accrue only at the initial publication of defamatory material.

Indeed, the Court’s reference to claim accrual rules from privacy and reputational torts came from White Castle’s own arguments. White Castle argued that the single publication rule should apply to BIPA claim accrual. White Castle cited to the Illinois Supreme Court’s reasoning in Rosenbach v. Six Flags, to support its argument that only the initial violation of the BIPA “aggrieved” the plaintiff. White Castle further supported its argument that disclosure of biometric data constitutes a “publication” by citing to the Illinois Supreme Court’s recent decision in West Bend Mutual Insurance Co. v. Krishna Schaumburg Tan, Inc., which held that a disclosure of a fingerprint scan in violation of the BIPA was a “publication” within the meaning of a commercial insurance policy. The Court found this to be “a plausible reading of the statute,” and noted that “if White Castle is right, [plaintiff’s] section 15(d) claim is untimely.”

Ultimately, the Seventh Circuit concluded that “the practical implications of either side’s interpretation, to the extent that Illinois courts would weigh them, do not decisively tilt one way or the other,” prompting it to certify the issue to the Illinois Supreme Court.

The Court’s full opinion is available here.

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