CHICAGO — A federal judge ruled Macy’s might be able to avoid some allegations of violating privacy rights in New York and California, but its use of Clearview AI facial recognition technology could make it liable under Illinois' biometric privacy law.
U.S. District Judge Sharon Johnson Coleman issued an opinion Jan. 27 regarding a consolidated class action involving allegations Clearview “covertly scraped billions of photographs of facial images from the internet and then used artificial intelligence algorithms to scan the face geometry of each individual depicted in the photographs to harvest the individuals’ unique biometric identifiers and corresponding biometric information,” Coleman wrote.
The larger consolidated legal action involves multiple allegations against Clearview and its founder Hoan Ton-That, and executive Richard Schwartz, both New York residents. Macy’s is a defendant because it allegedly bought access to Clearview’s database in order to cross-reference its own surveillance footage. The plaintiffs allege Macy’s accessed the database more than 6,000 times, uploading images to search for matches, situating it similarly to other database users in the proposed class of Clearview clients.
Coleman granted Macy’s motion to dismiss a claim under California’s Unfair Competition Law and a New York common law unjust enrichment claim. But the judge sided with plaintiffs regarding their allegations under Illinois’ Biometrics Information Privacy Act and other claims involving proposed subclasses for California and New York plaintiffs.
“The basis of plaintiffs’ BIPA claim,” Coleman wrote, is that “Macy’s actively purchased access to obtain plaintiffs’ biometrics without complying with BIPA’s notice and consent requirements.”
Coleman ruled the plaintiffs plausibly alleged a BIPA violation because their complaint reasonably allows an inference the facial data was a core component of Macy’s loss prevention strategy and that it “generated profits by reducing the number of stolen goods.” That connection between the use of personal information and the retailers’ larger business model proved essential to the surviving claims.
In agreeing to dismiss part of the California complaint, Coleman said Macy’s successfully argued facial imagery doesn’t constitute property as the Unfair Competition Law defines. She also agreed the allegations don’t “involve the protection of fair competition in commercial markets” and dismissed that claim without prejudice.
However, Coleman said a California common law right to privacy claim survived because it plausibly alleged Macy’s used images “without authorization for commercial gain.” She likewise rejected Macy’s position the law required an allegation it used Clearview’s database for “advertising, selling or soliciting” because the law includes a reference to nonconsensual use of a “likeness in any manner” for a commercial purpose. Coleman further said the allegations for the California subclass adequately argue a reasonable expectation of privacy sufficient to sustain their claims under that state’s constitution.
Coleman allowed the New York subclass’ claim under that states Civil Rights Act to survive because it plausibly alleged use of the Clearview database “for trade purposes,” but dismissed the common law unjust enrichment claim as pre-empted under the Civil Rights Act. She would not, however, dismiss unjust enrichment claims brought under other Illinois and California law. In both cases, she rejected Macy’s arguments the claims were brought independently of the other allegations. However, since the complains linked the database access and the company’s business model, the claims are suitably linked to survive dismissal.
The plaintiffs are represented in the action by attorneys Scott R. Drury, Mike Kanovitz and Andrew Miller, of the firm of Loevy & Loevy, of Chicago.
Macy's is represented by attorney Daniel Reza Saeedi, and others with the firm of Taft Stettinius & Hollister, of Chicago.