BIPA Cases: 7th Circuit Rules Change to Illinois Law’s Damages Provision Retroactively Limits Defendant Exposure

Takeaways

• The Seventh Circuit held that the 2024 amendment to BIPA’s damages provision applies retroactively, eliminating the possibility of “per‑scan” statutory damages for cases pending at the time of enactment.
• The court reasoned that the amendment affects remedies, making it a procedural change that applies to existing cases under Illinois retroactivity principles.
• The decision significantly limits defendants’ potential exposure in pending BIPA cases and may require courts to reassess federal subject‑matter jurisdiction.

Related link

• Clay v. Union Pacific Railroad Co.

Article

On April 1, 2026, a unanimous panel of the U.S. Court of Appeals for the Seventh Circuit issued a significant ruling foreclosing the possibility of “per-scan” damages under the Illinois Biometric Information Privacy Act (BIPA). Clay v. Union Pacific Railroad Co., No. 25-2185. The court’s decision has important implications for BIPA defendants sued before Aug. 2, 2024.

The Seventh Circuit held that the 2024 legislative amendment to BIPA’s damages provision (Section 20) “applies retroactively because it impacts only the statutory damages available to plaintiffs—it does not change BIPA’s substantive standards of liability.” Section 20 provides that a plaintiff may only obtain, at most, one recovery of statutory damages where the same biometric identifier or biometric information is collected using the same method.  

The decision has significant consequences. It is now clear that defendants sued before the enactment of the amendment, P.A. 103-0769, on Aug. 2, 2024, cannot face so-called per-scan or per-disclosure statutory damages of up to $1,000 or $5,000 that plaintiffs have argued are possible after the Illinois Supreme Court’s 2023 decision in Cothron v. White Castle Sys., Inc., 216 N.E.3d 918.

In Cothron, the Illinois Supreme Court held that a new BIPA claim accrues with each scan or disclosure. However, the Illinois Supreme Court also held that damages are discretionary under BIPA and found that there was “no language in the Act suggesting legislative intent to authorize a damages award that would result in the financial destruction of a business.”

Clay answered certified questions and two consolidated cases pending in the U.S. District Court for the Northern District of Illinois, Gregg v. Cent. Trans. LLC and Willis v. Universal Intermodal Servs., Inc., et al. The questions the Seventh Circuit was asked to decide focused on two issues:

1. Whether the amendment is only a clarification of Section 20 of the BIPA, meaning that it would apply to all cases pending at the time it was enacted; and 
2. Whether the amendment is retroactive such that it applies to cases pending when it was enacted.

The Seventh Circuit appreciated the magnitude of its endeavor. As Chief Judge Michael Brennan noted, “The financial stakes of this case are high. If the amendment does not apply, each plaintiff argues he is entitled to a substantial award of damages.”

In fact, the plaintiffs argued that under their interpretation of the statute, they were entitled to $7.5 million in statutory damages for their individual claim and “billions of dollars in damages” in the case brought as a putative class action. Ultimately, the Seventh Circuit rejected the plaintiffs’ arguments and held that the amendment applies retroactively.

Background

In each consolidated case, the plaintiff alleged that the defendant violated the BIPA by requiring them to use alleged biometric devices without providing certain disclosures and obtaining consent (subsection 15(b)) or disclosing their data without obtaining their consent (subsection 15(d)).

Each defendant asserted that, after the BIPA amendment, each plaintiff was only entitled to one recovery of statutory damages, at most, under the BIPA. In Gregg, the district court initially agreed with the defendant, but later reversed its decision. In the other two cases, the district courts held the amendment was a substantive change to BIPA that only applied prospectively.

The three defendants moved to amend the adverse decisions and certify questions for interlocutory appeal. The respective judges granted certification and the Seventh Circuit exercised its discretion to hear the appeals.

The Amendment Is Retroactive

The Seventh Circuit agreed with the defendants. The court noted the “high-stakes” nature of BIPA claims under a per-scan regime.

Looking at the plain text of the statute and the Cothron decision, the court said it was clear that the amendment concerned the damages available under Section 20 of the BIPA, not substantive requirements of the statute.

Turning to the test for retroactivity under Illinois law, the court found that the amendment was not substantive, but rather procedural because it merely affected the remedies available under the statute. Because procedural changes apply retroactively, the court found the amendment applies to cases pending at the time it was enacted.

The Seventh Circuit’s decision in Clay could have potential ramifications for federal subject-matter jurisdiction in pending BIPA cases, particularly where the possibility of per-scan damages was used to satisfy the amount-in-controversy requirement. Thus, the court specifically noted that the district courts may need to evaluate how its holding could affect subject-matter jurisdiction.

* * *

The Seventh Circuit’s ruling in Clay significantly limits the potential exposure in BIPA cases that were pending at the time the amendment was enacted in 2024 and may ultimately result in several cases being dismissed or remanded to state court due to lack of federal subject-matter jurisdiction. Defendants with pending BIPA cases are encouraged to reevaluate how the decision in Clay may impact their case going forward.

Please contact a Jackson Lewis attorney with any questions.