A small, but growing, group of law firms from Chicago - but increasingly from out of state, as well - has been growing rich off of class action lawsuits under Illinois' biometrics privacy law, as a spate of recent court decisions have all but forced employers and other businesses operating in Illinois that have been targeted by the lawsuits to collectively pay billions of dollars to settle, or risk even worse financial damage in court, a new report claims.
This week, the Citizens Against Lawsuit Abuse of Illinois released its latest Predatory Lawsuit Report. This time, the report focused on the ever increasing mountain of lawsuits brought under the Illinois Biometric Information Privacy Act.
The report noted that only a handful of law firms thus far have jumped into the growing pool of BIPA litigation.
Phil Melin
| Illinois Citizens Against Lawsuit Abuse
However, even those few firms have generated a load of trouble for Illinois' economy, the report says.
In all, the report says just seven "predatory law firms" have filed 745 active BIPA lawsuits in federal court or in courts in the Chicago area, where most of the BIPA activity is centered. This accounts for 69% of all BIPA litigation still pending in those courts, the CALA-IL report said.
Those seven firms include Beaumont Costales, based in New Orleans; Stephan Zouras, of Chicago; Peiffer Wolf, based in New Orleans; Fish Potter Bolanos, of Naperville; McGuire Law, of Chicago; Wolf Haldenstein, based in New York; and Justicia Laboral, of Chicago.
All of those firms operated offices in Chicago, as well.
Three of those firms - Beaumont Costales, Stephan Zouras and Peiffer Wolf - accounted for 437 BIPA-related suits still pending in court in the region, as of Nov. 13.
The report indicated 128 law firms combined to account for 1,141 BIPA lawsuits still active in courts in Cook County and elsewhere in the Chicago metropolitan region, as of Nov. 13, the report said.
“While BIPA was initially enacted with good intentions to protect individuals' biometric privacy, the report reveals how it has become a vehicle for predatory law firms exploiting a legislative loophole in the BIPA law,” said CALA-IL Executive Director Phil Melin, in a prepared statement issued with the report.
The BIPA law has gained notoriety throughout the country and the world in recent years, as a growing cadre of class action law firms have used the law to amass billions of dollars in attorney fees from settlements from businesses terrified at the prospect of facing “annihilative” and “catastrophic” payouts at the hands of juries.
Enacted in 2008, the Illinois BIPA law was ostensibly designed to safeguard the so-called unique identifying biometric information of consumers and employees, such as their fingerprints, retinas or facial geometry, among others. It was inspired by the collapse of the company known as Pay by Touch, which had been among those pioneering the ability of consumers to pay for goods and services by linking their banking information to one of the unique biometric identifiers, in that case, their fingerprints.
To coerce compliance with the law, the BIPA measure included steep financial penalties of $1,000 or $5,000 per violation, depending on how willful the business could be seen to be in not complying.
Since 2015, however, class action lawyers have flooded the court dockets in Cook County, the collar counties and downstate courts, as well, with class action lawsuits under the BIPA law.
A sizable portion of those lawsuits have targeted big tech companies, like Facebook-parent company Meta and Google, among many others, for allegedly scanning people's faces in uploaded photos without notice or consent. Several of those lawsuits resulted in headline-grabbing settlements, notably including $650 million paid by Meta for Facebook face scans.
However, the vast majority of the lawsuits have targeted employers of all types and sizes in Illinois. Typically, those lawsuits have asserted employers have improperly required workers to scan their fingerprints or other biometric identifiers to punch in and out of work shifts or to access secure or sensitive areas in a workplace, such as patient medication lockers in hospitals, cash rooms in retail stores, or rail yards, which operate under federal security mandates.
Recently, a growing spate of BIPA class actions, notably led by the Beaumont Costales firm, have targeted trucking companies for using so-called biometric cameras to scan truck drivers' faces to monitor their activities in real time.
Lawsuits have also targeted vendors of biometric workplace technology, resulting in still more settlements collectively worth hundreds of millions of dollars.
The law's power has come from a series of rulings from the Illinois Supreme Court since 2019.
The state high court has ruled the law can be interpreted to define individual violations as each time a company scans a biometric identifier from a worker, customer or device user without explicit notice or consent, over a five year period preceding the lawsuit.
Further, the court has ruled that plaintiffs don't need to prove they were ever actually harmed by the collection of the data, only that the technical provisions of the law may have been violated.
And the court has repeatedly closed off many legal avenues for employers to defend themselves against the lawsuits, often leaving little choice for employers other than settlement, to avoid potentially even bigger payouts that may be ordered by juries.
The CALA-IL report comes several months after a different business advocacy group, the McLean, Virginia-based Chamber of Progress, indicated the law firms bringing BIPA class actions have found a lucrative and steady source of revenue, raking in up to 40% of all money paid by businesses targeted by BIPA class actions.
The Chamber of Progress report, issued in April 2023, estimated trial lawyers have received, on average, $11.5 million in fees from BIPA-related lawsuits.
By contrast, class members typically receive an average payout of $506 each, under data available to that date.
“The largest beneficiaries of BIPA cases alleging consumer harm appear to be plaintiffs’ law firms,” the Progress Chamber report said.
In light of the damage inflicted on employers and other businesses in Illinois from such litigation, business advocacy groups have called on Illinois lawmakers to reform the law to reduce the potential risk to employers and the state's economy.
So far, however, the state's Democratic supermajority in the General Assembly have resisted such calls. Illinois Democrats receive millions of dollars every year in campaign donations from trial lawyers, according to campaign finance records.
Melin repeated the call to lawmakers to take action to protect the state's economy from this litigation risk.
"These findings reveal an alarming trend of predatory law firms exploiting the BIPA loophole, causing severe harm to our state's businesses," Melin added. "We must act now to protect our local economy and communities."