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Insurance liability under Illinois’ biometric data privacy law gets another look

AI draws attention to core issue of data ownership
Insurance liability under Illinois’ biometric data privacy law gets another look

Insurers are on the hook to defend separate defendants accused breaking the U.S. state of Illinois’ Biometric Information Privacy Act.

Tony’s Finer Foods Enterprises’ commercial insurer Continental Western is owed coverage as part of the grocery company’s general liability policy, an Illinois federal judge has ruled. Tony’s is accused in case 1:22-cv-03575of collecting employee fingerprints without consent, a violation of BIPA.

The case is being heard in the U.S. District Court for the Northern District of Illinois.

A similar decision was recently handed down in the putative class action (22-2313) Citizens Insurance v. Wynndalco Enterprises.

A Seventh Circuit judge ruled that Citizens must honor the business liability policy it sold to Wynndalco, which faces two proposed class action. Wynndalco was an intermediary in the sale of a picture-scraper Clearview AI subscription to CDW-Government, the purchasing agent for the Chicago Police Department.

The plaintiffs alleged that using the subscription violated BIPA.

In the case between Citizens and Wynndalco, the insurer said its violation-of-statutes exclusion barred coverage against these suits. But an analysis by Reed Smith attorneys for Law360 says the court had to construe the ambiguity of the exclusion in favor of Wynndalco, given that a list of statutes contained in the provision does not mention the right to privacy.

Meanwhile, Google and YouTube’s bid to have a BIPA case dismissed failed.

In a putative class action (3:22-cv-06987), YouTube and Google are accused of violating BIPA by harvesting biometric identifiers through a pair of video-editing tools, called Face Blur and Thumbnail Generator without consent.

The motion to dismiss was rejected because the plaintiff’s privacy interests were directly affected when YouTube did not post its data-management policies as required by BIPA.

And for a change of pace, plaintiffs are charging OpenAI and its benefactor Microsoft with scraping and misappropriating consumers’ biometric identifiers, according to marketing analysis by the law firm Ballard Spahr. The data is being use in training large language models, allegedly.

While the proposed class action was not filed under BIPA, the firm says the case could put a light on the issues at the Illinois’ law’s core: an individual’s right to own, control and be informed about issues involving their biometric data.

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