Seventh Circuit Limits Potential Damages Under BIPA, Holds 2024 Amendment Applies Retroactively

Last week, the Seventh Circuit issued a critical opinion for companies facing lawsuits under the Illinois Biometric Information Privacy Act (“BIPA”). In Clay v. Union Pacific Railroad Co., No. 25-2185, 2026 WL 891902 (7th Cir. Apr. 1, 2026), the court held that a 2024 amendment to BIPA that limited damages to one recovery per person and not “per-scan” (each time a biometric identifier is collected) applies retroactively to cases pending at the time the amendment was enacted.

Background

BIPA regulates the collection, possession, disclosure, and sale of biometric identifiers, including fingerprints, voiceprints, retina or iris scans, and face or hand scans. The 2008 law provides a private right of action and allows for statutory damages—up to $1,000 per negligent violation, and up to $5,000 per reckless or intentional violation, plus attorneys’ fees and injunctive relief. 740 ILCS 14/20.

As BIPA litigation surged, courts faced a key question: whether a BIPA claim accrues each time a private entity collects or transmits an individual’s biometric identifier or information—i.e., “per-scan”—or only upon the first scan or transmission. The Illinois Supreme Court addressed that question in 2023, holding in Cothron v. White Castle System, Inc., 2023 IL 128004, that a BIPA claim brought under provisions governing the collection and disclosure of biometric identifiers accrues each time an entity collects or transmits an individual’s biometric identifier. The court noted the potential for “annihilative liability,” but put that issue to the legislature to resolve.

The Illinois General Assembly answered the call with SB2979, signed into law by Governor Pritzker in August 2024. SB2979 clarified that the repeated collection or disclosure of the same biometric identifier from the same person and using the same collection method is a single violation that allows a single recovery of statutory damages. The 2024 amendment, however, left a key question unanswered: whether it applies retroactively to lawsuits pending at the time it was passed. See our prior alert on the issue here. After several trial courts held that it applied prospectively only, the Seventh Circuit consolidated interlocutory appeals in three such cases on the question of whether the amendment applied prospectively or retroactively.

The Seventh Circuit’s Retroactivity Ruling

On April 1, 2026, in Clay v. Union Pacific Railroad Co., the Seventh Circuit reversed the rulings below and held that the amendment applies retroactively. To reach this holding, the court applied the well-established Illinois retroactivity test: if the amendment is remedial in nature, it is procedural and therefore applies retroactively; but if it is substantive in nature, then it only applies prospectively. The court analyzed the text and structure of the amendment and concluded it is remedial for two main reasons. First, the amendment revised Section 20 of BIPA—the provision that specifies statutory damages—and made no changes to Section 15 of BIPA—the provision that sets substantive standards for liability. Second, the language of the amendment speaks to remedies, stating that an “aggrieved person is entitled to, at most, one recovery” under BIPA. In other words, because the amendment “addresses the availability of damages, not proscribed conduct,” it is a “procedural” rather than “substantive” amendment.

The Seventh Circuit also emphasized that the amendment reaffirmed the Illinois Supreme Court’s observation in Cothron that BIPA damages are “discretionary.” The amendment states that plaintiffs are “entitled to, at most, one recovery,” so, as the court observed, BIPA’s provisions prescribe the maximum, not minimum, statutory damages that a court may award. As the court explained, “[i]f courts have discretion to decide whether to award damages at all, then plaintiffs were not guaranteed any specific recovery in the first place,” and the amendment simply “cabin[ed] the discretion of trial court judges when they fashion the remedy.” This further supported the conclusion that the amendment is remedial.

Practical Implications

Clay will have an immediate impact on current BIPA cases and the potential range of damages exposure. It eliminates “per-scan” damages in federal cases within the Seventh Circuit, thus limiting BIPA plaintiffs’ maximum recovery to “per-person” damages. This change will, of course, impact settlement analyses going forward.

Still, BIPA litigation risk remains. Claims under the 2008 law continue to be filed on a frequent basis, and there is still the potential for substantial damages given BIPA’s significant statutory damages—especially in cases with larger class sizes. Companies should thus continue to monitor for the potential collection or transmission of biometric identifiers and consider taking steps to address requirements under BIPA and other state biometric privacy laws. For additional information on steps companies can consider taking to reduce BIPA risks, see our prior alert.

This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.