The U.S. Court of Appeals for the Seventh Circuit recently resolved a critical question left open by Illinois’ August 2, 2024 amendment to the Biometric Information Privacy Act (“BIPA”): whether the amendment applies retroactively to pending cases. We previously reported that Illinois courts would need to address this issue in their pending cases. In a decision with significant implications for employers and businesses operating in Illinois, the 7th Circuit held that the amendment is remedial in nature and therefore applies retroactively.
This ruling substantially alters the potential exposure in BIPA litigation and provides much-needed clarity following a period of inconsistent state and federal district court decisions.
BIPA Amendment: Clear on Damages, Silent on Retroactivity
The proliferation of biometric technologies—ranging from fingerprint timekeeping systems to facial recognition and voiceprint authentication—has significantly expanded BIPA-related litigation risk for Illinois businesses.
Under BIPA’s original framework, statutory damages were set at:
- $1,000 per negligent violation, and
- $5,000 per reckless or intentional violation.
Critically, in Cothron v. White Castle, the Illinois Supreme Court interpreted BIPA to allow damages on a per-scan basis, meaning that each individual biometric scan could constitute a separate violation. This interpretation created the potential for extraordinary and, in some cases, existential liability, particularly in the employment context where employees scan in and out daily. For example, a single employee scanning twice per workday could theoretically generate hundreds of thousands—or even millions—of dollars in damages annually.
Recognizing the severity of this exposure, the Illinois legislature amended BIPA on August 2, 2024 to clarify that a prevailing plaintiff may recover only one statutory award per violation, regardless of the number of scans.[1]
However, the amendment did not address whether it applied retroactively, creating uncertainty for already pending cases.
Retroactivity Framework Under Illinois Law
Under Illinois law, statutory amendments are presumed to apply prospectivelyunless one of the following exceptions applies:
- The legislature expressly states retroactive intent;
- The amendment clarifies existing law; or
- The amendment is procedural or remedial, rather than substantive.
Because the BIPA amendment did not expressly address retroactivity, courts were required to determine whether it was substantive (affecting rights) or remedial (affecting the method of enforcement or recovery).
Split Among Federal Courts
In the absence of Illinois Supreme Court guidance, the Northern District of Illinois’ district courts have reached conflicting conclusions.
- Some courts held the amendment was a clarification, applying retroactively.
- Others found it to be a substantive change, limiting its application to post-amendment claims.
However, courts more frequently adopted the latter position, resulting in inconsistent outcomes across similar cases.
The Seventh Circuit Heard Both Sides’ Arguments in Consolidated Appeals
The Seventh Circuit addressed the issue through three consolidated appeals:
- Clay v. Union Pacific Railroad Co.
- Willis v. Universal Intermodal Services, Inc.
- Gregg v. Central Transport LLC
Both plaintiffs and defendants agreed that the court’s ruling would significantly impact BIPA litigation but disagreed on the amendment’s characterization:
- Defendantsargued the amendment is remedial because it modifies damages, not liability.
- Plaintiffs argued it is substantive because it limits recoverable damages, potentially eliminating previously accrued claims.
The Seventh Circuit’s Holding
The Seventh Circuit declined to certify the question to the Illinois Supreme Court, concluding that Illinois’ retroactivity principles are sufficiently well-established to enable a determination without deferring the question.
The court held that the amendment is remedial and therefore applies retroactively.
In reaching this conclusion, the court emphasized:
- The amendment affects only the measure of damages, not the underlying right to bring a BIPA claim;
- Illinois precedent treats changes impacting remedies as procedural or remedial; and
- BIPA’s statutory damages framework is distinct from the substantive privacy rights created by the statute.
In its opinion, the court characterized the amendment as a “procedural” or “remedial” change under Illinois law, reinforcing its retroactive application.[2]
Key Implications for Employers and Businesses
This decision materially reduces the potential exposure in BIPA cases, particularly in employment-related claims involving repeated biometric scans. Employers and litigants should consider the following:
1. Reassess Jurisdictional Strategy
The reduced damages framework may affect whether claims meet:
- Federal diversity jurisdiction thresholds, and
- CAFA requirements.
Early evaluation of jurisdiction is now critical.
2. Monitor State Court Developments
Illinois appellate courts have not yet addressed this issue. While the Seventh Circuit’s decision is binding on federal courts, state courts may take a different approach.
3. Update Litigation and Settlement Strategy
The amendment—and its retroactive application—significantly alters:
- Case valuation
- Settlement posture
- Insurance reporting and reserves
Businesses should revisit existing exposure analyses accordingly.
Conclusion
The Seventh Circuit’s decision provides much-needed clarity and relief for businesses facing BIPA claims. By confirming that the 2024 amendment applies retroactively, the court has substantially curtailed the risk of outsized statutory damages driven by per-scan liability.
We will continue to monitor developments in Illinois state courts and any further legislative activity affecting BIPA.
[1] BIPA UPDATE: Illinois Adopts Reform Limiting Potential Claims (and Damages) in Litigation | Thompson Coburn LLP
[2] Reginald Clay v. Universal Intermodal Services, Inc., et al., No. 25-2185, 15-16 (7th Cir. 2026).
