A Chicago federal judge says she appointed the law firm of Loevy & Loevy to serve as co-lead counsel in a potential massive biometrics-related class action over face scans conducted by tech firm Clearview AI, ruling in a court fight between the firm and one of its former partners over who has the best claim to a possible big payday from a potential settlement.
On Nov. 23, U.S. District Judge Sharon Johnson Coleman ruled in favor of the Chicago-based Loevy firm in a dispute with attorney Scott Drury, a side tussle which took center stage in the last few weeks in the sprawling consolidated case against Clearview.
“Though this matter has devolved into disarray, the issue before the Court is quite simple: who did the Court appoint as interim lead counsel, and may they continue as such?” Judge Coleman wrote.
Scott Drury, formerly of Loevy & Loevy
| Loevy & Loevy
“At bottom, the parties disagree about the interpretation of the Court’s appointing interim lead counsel. Loevy contends that the Court appointed the firm as a whole, while Drury argues that he alone was appointed and should be permitted to continue in that role as a solo practitioner.
“The Court now clarifies that it appointed Scott Drury to the extent that he served as counsel of Loevy, not as an individual.”
For more than a year, Drury had worked with his former colleagues at Loevy & Loevy to help lead a consolidated class action against Clearview.
Drury is also a former state lawmaker, former federal prosecutor, and one-time candidate for Illinois Attorney General.
For nearly two years, Clearview has sought to defend itself against an array of lawsuits, accusing the New York-based facial recognition tech firm of violating the law known as the Illinois Biometric Information Privacy Act. According to the lawsuits, Clearview scraped more than three billion photographs posted online, then used artificial intelligence algorithms to scan the facial geometry of people imaged in those photos. The scans harvested unique biometric identifiers from the faces imaged in those photos, which Clearview used to build databases it then sold to law enforcement agencies, retailers and others.
The lawsuits assert Clearview was required to first get express permission from Illinois residents pictured in those photos before scanning their faces, and provide everyone with certain notifications allegedly required by the BIPA law concerning what Clearview planned to do with the scans.
Should those legal claims ever go to trial, Clearview could face payouts worth hundreds of millions of dollars, or even billions of dollars, under the BIPA law.
The law has been used by a growing number of plaintiffs’ law firms to extract a mounting number of settlements from thousands of companies targeted by BIPA-related class action lawsuits since 2015.
Facebook famously settled for $650 million, while Google has agreed to pay $100 million to end a consolidated class action accusing it of also violating BIPA by scanning faces in photos people uploaded to its Google Photos platform.
A recent jury trial in Chicago showed the risk companies face from the BIPA law. A jury ordered freight rail operator BNSF to pay $238 million to a group of 45,000 truckers who were required to scan their fingerprints to verify their identity when entering secure rail yards in Illinois. Plaintiffs have since asked the judge to increase the payout to as much as $800 million.
From any settlements or judgments, the attorneys stand to rake in many millions of dollars in attorney fees.
According to court documents, Clearview has indicated it is willing to discuss a settlement to resolve the claims against them, likely to avoid a staggering jury verdict.
However, this summer, Drury abruptly separated from the Loevy firm to launch his own private practice. In the process, he persuaded Loevy’s named clients in the Clearview lawsuits to stick with him, rather than the Loevy firm.
Loevy & Loevy responded to the move with a motion in October, asking Judge Coleman to clarify who she intended to lead the case, the Loevy firm overall, or Drury, individually.
In its motion, Loevy & Loevy accused Drury of directing the firm to “immediately withdraw from the case. This was presumably so that any resulting attorneys’ fee would come to his new firm,” named Drury Law.
They noted Drury did not disclose to the firm that Clearview was even discussing a possible settlement. They instead learned of it from Clearview’s attorneys following Drury’s departure, according to their motion.
Drury responded by asserting he is essential to leading the cases against Clearview. Without Drury’s experience and expertise, the Loevy firm would not have ever landed one of the lead spots in the class action, Drury asserted in his response, filed on Nov. 1.
He noted both the judge and the Loevy firm itself noted the importance of Drury’s involvement in the case.
Drury asserted his departure would leave Loevy unable to lead the cases any longer.
Judge Coleman, however, sided with the Loevy firm in the dispute.
She again noted Drury’s depth of expertise, and said it was a major factor in her decision to appoint Loevy co-lead counsel in the case, a designation the firm holds with the firms of Bursor & Fisher and Hedin Hall.
But the judge said she was also “persuaded by Loevy’s presence in the case as a well-resourced firm with documented expertise in class action litigation.”
“Had Drury sought the interim lead counsel position as a solo practitioner in March 2021, as he does now, the Court would not have appointed him - a fact that no one disputes,” Coleman wrote.
The judge also said it does not matter that Drury took all of the Loevy firm’s clients in the case with him when he departed the firm.
She said in a class action lawsuit, the named plaintiffs differ from traditional plaintiff clients. Once a lead counsel is appointed in a class action like this one, those named plaintiffs merely serve as “class representatives,” and lose the ability to “direct the actions of lead counsel” and lose the ability to fire their lawyers, without permission from the court.
Allowing Loevy & Loevy to remain as co-lead counsel in the Clearview class action is “an uncommon circumstance,” the judge said, but “is not … unheard of.”
In other cases, she said, judges have allowed competing law firms to effectively bid on the chance to lead class actions, resulting in the appointment of law firms who had not even “filed a preliminary complaint in the case or represented a named plaintiff.”
“Here, allowing Loevy to continue as lead counsel despite the election of its former clients is not as drastic of a measure because Loevy has been with the case since its inception,” Judge Coleman said.
The judge directed Loevy and other attorneys helping to lead the case against Clearview to work together on drafting “an order for the Court’s review and approval broadly outlining their responsibilities going forward.”
She also directed the Loevy firm to discuss with the other lawyers on the case concerning how the lawyers will get paid from any potential settlement, “in an effort to prevent future attorney fee disputes.”
She warned the parties they have until Dec. 16 to “resolve these issues.”