A Chicago judge’s decision on whether to amend a $228 million judgment against BNSF Railway Co. will provide a first glimpse into how courts will interpret an Illinois Supreme Court decision opening the door to enormous damages awards for violations of the state’s Biometric Information Privacy Act.
Plaintiffs in Rogers v. BNSF Railway Co. have argued in post-trial motions that the judgment was far too low given the state high court’s February ruling in Cothron v. White Castle Sys. Inc. that a violation occurred each time a worker’s fingerprint was scanned.
Judge Matthew Kennelly of the US District Court for the Northern District of Illinois had calculated the BNSF award based on a finding of just one violation per worker, rather than one per scan.
But BNSF filed post-trial motions arguing that the judgment was too high because the trial court treated the damages award as mandatory, an approach in tension with the state high court’s finding in White Castle, that BIPA damage awards are discretionary.
The use of discretion is particularly appropriate in this case, where there was no finding that the plaintiffs suffered any harm beyond statutory violations related to informed consent, the freight rail company said.
Biometric privacy attorneys interviewed by Bloomberg Law were reluctant to make any predictions about how Kennelly will rule on the parties’ motions. But they agree that the BNSF case—the first to go to trial since BIPA was enacted in 2008—provides a highly visible test case for how courts will approach the issue of biometric privacy damages in the wake of the White Castle ruling.
It’s up to the judge to decide how quickly to rule on the motions, but there’s reason to think he’ll act “pretty quickly,” said Jody Kahn Mason, a principal with Jackson Lewis PC in Chicago.
“This is such a significant issue, I think he won’t delay too long,” she said.
Kennelly said last month that he’d set the competing motions for oral argument if necessary, but didn’t give any further indication on when he’d issue a ruling.
Kennelly entered the $228 million judgment against BNSF after a jury found that the railroad had recklessly or intentionally violated BIPA 45,600 times, one violation per member of the class. His decision also subjected BNSF to the maximum statutory penalty of $5,000 per violation.
The plaintiffs argued, in a motion to amend the judgment filed before the White Castle ruling, that the judgment was too low because it didn’t take into account the fact that BNSF workers were required to submit three finger scans when they first registered with the timekeeping system.
The workers asked for a new trial on damages to assess the total number of biometrics collected by BNSF as they entered and left the railyards each day.
A calculation based on that many violations could lead to a “truly astronomical damages award,” said Mary Smigielski, a partner with Lewis Brisbois Bisgaard & Smith LLP in Chicago, and chair of the firm’s BIPA practice group.
But damages awards so large they could wipe out a business or throw it into bankruptcy weren’t “what the court had in mind,” she said.
“One of the most important implications that I see coming out of the White Castle ruling is that the court affirmed what is in the plain language of the statute, that damages ‘may’ be awarded but don’t have to be awarded,” she said.
Some defense attorneys see the possibility that the court’s holding on discretionary damages could actually reduce damages awards and settlements in BIPA cases, but Jeffrey Rosenthal, the biometric privacy team lead at Blank Rome LLP in Philadelphia, wasn’t so sanguine.
“It’s true that you can pull the court’s statements on discretion out of this ruling and take some comfort, maybe that relieves the doom and gloom a bit, but as I’ve explained to clients, if you’re banking on the judge at the end of the day, that’s a lot of risk,” Rosenthal said.
Lack of Harm
A central issue of the BNSF case, bearing on the question of whether the court should amend the award, is the lack of actual harm to the plaintiffs, said Mark Olthoff, a shareholder with Polsinelli PC in Kansas City, Mo.
There was no finding in the case that the biometric information of the workers was subject to an unauthorized disclosure, he said.
The Illinois Supreme Court held in a previous case, Rosenbach v. Six Flags Entm’t Corp., that a mere statutory violation of BIPA was sufficient for an award of damages even without a showing of concrete harm, Olthoff said.
But an eye-popping damages award in the absence of actual harm could raise due process concerns under the US Constitution, he said.
“I’m not aware of any incidents where biometric information collected as part of a timekeeping system has been disclosed down the road, or where the information has gotten out through a data breach or something like that,” he said. “These are really no-harm scenarios, but with the possibility of enormous damages. It’s certainly an issue that a court could consider in the future.”
The BNSF jury also found that the railroad’s violations were reckless and intentional, which could have an important effect on how Kennelly exercises his discretion, Olthoff said.
“This is different from most BIPA cases, where the defendant wasn’t aware of the requirements of the Act, or made an attempt to comply while falling short of full compliance,” the attorney said. “Here the jury’s finding of reckless and intentional violations puts this into a different category, and puts the company in a more uncomfortable position.”
Weighing against any expectation that Kennelly will amend the judgment is the fact that the discretionary nature of damages under BIPA had been acknowledged by the state’s high court prior to the White Castle ruling, said Karla Grossenbacher, a partner with Seyfarth Shaw LLP in Washington.
“It was clear from the statute and previous case law that damages were discretionary, and the judge wouldn’t have needed the White Castle decision to see that given the permissive language of the statute,” she said. “So it could be that he’ll say, ‘Hey, the plaintiffs are pushing me higher, BNSF says it should be lower, I’ll just exercise my discretion and keep it the way it is.”
The cases are Rogers v. BNSF Ry. Co., N.D. Ill., No. 19-cv-03083, notice of supplemental authority filed 2/23/23 and Cothron v. White Castle Sys. Inc., Ill., No. 128004, 2/17/23.
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