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From BIPA to GIPA: Another Four-Letter Word in Illinois Class Action Litigation, Part 5

09 Feb 2024

ABSTRACT: A fresh wave of litigation has recently emerged in Illinois commonly known by the four-letter acronym GIPA—the Genetic Information Privacy Act. In a five-part series of posts, we examine GIPA’s background, key provisions of the Act, the remedies available under GIPA, certain types of GIPA cases being filed, and considerations for companies regarding GIPA litigation.

This week, Baker Sterchi is dedicating this blog to a discussion of the Genetic Information Privacy Act (‘GIPA”). In a five-part series of posts, we examine GIPA’s background, key provisions of the Act, the remedies available under GIPA, certain types of GIPA cases being filed, and considerations for companies regarding GIPA litigation.

For our final post, we examine GIPA’s impact outside of the GIPA litigation context, potential strategies for companies named in GIPA litigation, and considerations for companies hoping to avoid GIPA litigation:

Admissibility of Genetic Testing and Information

GIPA has the potential to significantly impact parties and counsel in non-GIPA litigation. Specifically, GIPA may prohibit the discovery or admission of certain types of medical records and medical information. Pursuant to Section 15(a), except as provided in Section 15(b) and Section 30, genetic testing and information derived from genetic testing “shall not be admissible as evidence, nor discoverable in any action of any kind in any court…” Section 15(b) indicates that genetic testing and genetic information derived therefrom is admissible as evidence and discoverable, subject to a protective order, in actions alleging a violation of GIPA, seeking to enforce Section 30 of GIPA through the Illinois Insurance Code, alleging discriminatory testing or use of genetic information under the Illinois Human Rights Act or the Illinois Civil Rights Act, or requesting a workers’ compensation claim under the Workers’ Compensation Act. Finally, all information and records held by a State agency, local health authority, or health oversight agency pertaining to genetic information shall not be admissible as evidence nor discovery in any action of any kind in any court, except in limited circumstances, including when made with the written consent of all persons to whom the information pertains. 410 ILCS 513/30(b).

In cases where a party’s medical history is relevant, counsel should be aware of these provisions, particularly when genetic mutations, genetic predispositions, and histories of genetic-related conditions are at issue. The provisions discussed above will impact the process for obtaining medical records and information, inquiring into a party’s and a party’s family medical histories, and admitting evidence at trial.

GIPA Considerations

For parties named in GIPA litigation, there are few GIPA court opinions to provide guidance. Counsel, however, should consider some of the strategies employed in litigation involving the Illinois Biometric Information Privacy Act (“BIPA”) given certain similarities between the Acts and the litigation arising from them. For example, non-Illinois entities should consider asserting a personal jurisdiction defense. If the defendant’s conduct at issue occurred outside of Illinois, the defendant should have a general personal jurisdiction defense, which is an extremely limited form of jurisdiction typically reserved to a company’s state of incorporation and state in which its principal place of business is located.

Additionally, defendants should evaluate the possibility of a preemption defense. See, Big Ridge, Inc. v. Fed. Mine Safety & Health Review Comm’n, 715 F.3d 631 (7th Cir. 2013) (Federal Mine Safety & Health Act preempted plaintiffs’ GIPA claims). To the extent applicable, defendants may be able to compel arbitration of GIPA cases. For a discussion of this issue, see Coatney v. Ancestry.com DNA, LLC, No. 21-cv-1368-DWD, 2022 U.S. Dist. LEXIS 179873 (S.D. Ill. 2022) (defendant’s motion to compel arbitration denied); Melvin v. Big Data Arts, LLC, 553 F. Supp. 3d 447 (N.D. Ill. 2021) (defendant’s motion to compel arbitration denied); Manor v. Copart Inc., No. 17-cv-2585, 2017 U.S. Dist. LEXIS 175702 (N.D. Ill. Oct. 24, 2017) (granting defendant’s motion to compel arbitration). Similarly, in the employment context, defendants should evaluate whether any claims are encompassed by collective bargaining agreements. Finally, defendants should consider removal to federal court, as plaintiffs will need to satisfy federal pleading requirements and establish standing (i.e., establish a concrete harm or injury). As BIPA litigation has shown, however, plaintiffs may argue that no actual harm is required to pursue a GIPA claim and, therefore, remand is appropriate.

Companies doing business in Illinois also should evaluate their current business practices to ensure compliance with GIPA. Employers, for example, should review their hiring and pre-employment screening practices to avoid violating BIPA. Similarly, employers should be familiar with the practices of any third-party medical providers that screen or evaluate applicants or employees. Insurers, particularly accident and health insurers, should review their screening, underwriting, and actuarial processes.

Regarding insurance, companies should consider evaluating their current liability insurance coverage given the rise in GIPA lawsuits. As with BIPA litigation, insurance coverage disputes are likely to coincide with GIPA litigation. Insurers may argue that GIPA lawsuits do not satisfy the insuring agreement and/or trigger the employment-related practices, violation of law, or access or disclosure exclusions.

Conclusion

Baker Sterchi is closely monitoring GIPA litigation and potential amendments to the Act. Please continue following this blog for more updates.

From BIPA to GIPA: Another Four-Letter Word in Illinois Class Action Litigation, Part 4

08 Feb 2024

Today, we examine the types of lawsuits currently being filed under GIPA:

Insurance Cases

Recently, there has been an increase in GIPA lawsuits against insurers, alleging that the insurers violated GIPA by inquiring into individuals’ family medical histories to determine premiums, underwrite, and determine eligibility. GIPA suits have been filed against Northwestern Mutual, Mass Mutual, Pacific Life, AIG, and State Farm, among others. Pursuant to GIPA, an insurer may not seek information derived from genetic testing for use in connection with a policy of accident and health insurance. 410 ILCS 513/20(a). Additionally, an insurer shall not use or disclose protected health information that is genetic information for underwriting purposes. 410 ILCS 513/20(b). An insurer that possesses information derived from genetic testing may not release the information to a third party, except as specified in GIPA. 410 ILCS 513/20(d). An insurer may, however, consider the results of genetic testing in connection with a policy of accident and health insurance if the individual voluntarily submits the results and the results are favorable to the individual. 410 ILCS 513/20(c).

In some of the insurance-based GIPA suits, the plaintiffs are seeking a broad interpretation of the term “genetic information,” such that the term would encompass questions regarding family histories of any condition, not just genetic-related conditions. The plaintiffs base their theory on the definition of “genetic information.” As discussed in our Tuesday post, the term “genetic information,” as used in GIPA, has the same meaning as that term is used in HIPPA. HIPPA defines the term to include “the manifestation of a disease or disorder in family members of such individuals.” The plaintiffs maintain that this phrase is broad enough to encompass any illness or condition of family members.

This litigation raises the question of what types of family member diseases and disorders are encompassed by GINA’s definition of “genetic information.” Specifically, must the diseases and disorders be genetic-based, or does the Act apply to any disease and disorder? At this point, there are no Illinois court opinions addressing the scope of the family member provision of the term “genetic information” as used in GIPA. There are, however, court opinions examining the federal Genetic Information Nondiscrimination Act (“GINA”) that may prove helpful on this issue. GINA prohibits employers from requesting, requiring, or purchasing genetic information with respect to an employee or a family member of the employee. 42 U.S.C. § 2000ff-1(b). Like GIPA, GINA defines “genetic information” to include information about “genetic tests of family members” and “the manifestation of a disease or disorder in family members.”

In Willliams v. City of Chicago, the District Court for the Northern District of Illinois found that two plaintiffs alleged sufficient facts to avoid dismissal of their GINA claims. 616 F. Supp. 3d 808 (N.D. Ill. 2022). The plaintiffs participated in their employer’s wellness program. In doing so, they were asked to respond to questionnaires about their spouses’ medical histories. Taking the plaintiffs’ allegations as true and making all reasonable inferences in their favor, the court found the allegations sufficient to find that the plaintiffs provided genetic information under GINA (i.e., their spouses’ medical histories). In that case, however, the court did not discuss the scope of the employer’s medical questionnaire or otherwise identify the information sought about the plaintiffs’ spouses.

In Ries v. City of Chicago, the plaintiff argued that disclosure of COVID-19 vaccination status constituted a request to disclose the “manifestation of a disease or disorder.” According to the court, the plaintiff failed to demonstrate that vaccination status had “any bearing on the likelihood of his inheriting a genetic disease or disorder from a family member.” No. 22 C 2740, 2023 U.S. Dist. LEXIS 166246 (N.D. Ill. Sept. 19, 2023) (emphasis added). Notably, the court included the term” genetic” in its recitation of the family member component of GINA’s definition of “genetic information.”

Courts in other jurisdictions have more clearly limited the scope of the family member provision in GINA’s definition of “genetic information.” For example, the District Court for the Western District of Texas explained that an employer merely acquiring information about an employee’s family medical history “is of no matter” unless the employer uses that information to make a predictive assessment about its employee’s propensity to develop the same disease. Green v. Whataburger Rests. LLC, No. 5:17-CV-243-DAE, 2018 U.S. Dist. LEXIS 206793 (W.D. Tx. Oct. 9, 2018). The court reasoned that the purpose of the family medical history provision is to prohibit employers from making a predictive assessment concerning an employee’s propensity to get an inheritable disease or disorder in a family member. In that case, the only information the plaintiff provided about her family medical history was that her daughter needed surgery due to the possibility of cancer. The court determined that the fact the plaintiff’s daughter might have cancer had no predictive value with respect to the plaintiff’s propensity to acquire cancer.

Other courts have determined that for discrimination based on family medical history to violate GINA, the family medical condition must have a genetic predisposition and the employer must have believed that the medical information at issue had a genetic basis. Dabrowski v. Mayorkas, No. 19-3679 (BAH), 2022 U.S. Dist. LEXIS 42874 (D.C. D. Ct. March 10, 2022). See also, Baum v. Dunmire Prop. Mgmt., No. 21-cv-00964-CMA-NYW, 2022 U.S. Dist. LEXIS 54555 (D. Colo. March 25, 2022) (plaintiff’s father’s diagnosis of COVID-19 was “not the kind of genetic information contemplated by GINA”); Tedesco v. Pearson Educ., Inc., No. 21-cv-199, 2021 U.S. Dist. LEXIS 105157 (E.D. La. June 4, 2021) (father’s suicide not considered family medical history because the plaintiff failed to establish a causal link between his father’s suicide and genetic makeup); Lee v. City of Moraine Fire Dep’t, No. 3:13-cv-222, 2014 U.S. Dist. LEXIS 77963 (S.D. Ohio May 2, 2014) (the fact that employee’s primary relative had a history of prostate cancer was protected by GINA); Punt v. Kelly Servs., No. 14-cv-2560, 2016 U.S. Dist. LEXIS 1018 (D. Colo. Jan. 6, 2016) (holding the prevalence of breast cancer in the plaintiff’s family to be the type of genetic information implicated by GINA as “the manifestation of a disease or disorder in family members”); Jackson v. Regal Beloit Am., Inc., No. 16-cv-134, 2018 U.S. Dist. LEXIS 103682 (E.D. Ky. June 21, 2018) (family history of colon cancer was “genetic information”); Conner-Goodgame v. Wells Fargo Bank, N.A., No. 2:12-cv-3426, 2013 U.S. Dist. LEXIS 139477 (N.D. Ala. Sept. 26, 2013) (the plaintiff’s mother’s AIDS diagnosis did not constitute genetic information about a manifested disease or disorder); Poore v. Peterbilt of Bristol, L.L.C., No. ???, 2012 U.S. Dist. LEXIS 47114 (W.D. Va. April 4, 2012) (the plaintiff’s disclosure of his wife’s multiple sclerosis diagnosis did not trigger liability under GINA).

Given the dearth of GIPA court opinions on this issue, defendants sued for allegedly violating the family medical history provision of the genetic information definition should determine whether the medical condition at issue has a genetic predisposition. If not, defendants should consider relying on the cases discussed above to support a motion to dismiss or motion for summary judgment.

For life insurance companies named in GIPA litigation, there is a question of whether they are subject to liability under GIPA’s insurance section, 410 ILCS 513/20. Section 20(a) applies only to accident and health insurance policies. Section 20(b) prohibits the use or disclosure of protected health information that is genetic information for underwriting purposes. GIPA, however, defines “insurers” as 1) an entity that is subject to the jurisdiction of the Director of Insurance; and 2) a managed care plan. 410 ILCS 513/10. While life insurers are subject to the jurisdiction of the Illinois Director of Insurance, there is an argument they do not constitute a “managed care plan,” as that term is defined in Section 10 of GIPA. GIPA defines a managed care plan, in part, as a plan that establishes, operates, or maintains a network of health care providers that have entered into agreements with the plan to provide health care services to enrollees. Additionally, the Illinois legislature introduced a bill, HB 4142, to extend GIPA to the life insurance industry, suggesting that Section 20(b) currently does not apply to life insurers. As of this writing, no action has been taken on HB 4142 since 11/8/2023.

Employment Cases

A number of recent GIPA lawsuits name employers and allege that the employers required disclosure of family medical histories during the employment application process or inquired into family medical histories during pre-employment physicals. These suits have been filed against Ford Motor Company, World Wide Technology, Abbvie, and Amazon, among others.

Section 25 of GIPA governs employers. Section 25(a) requires that employers, employment agencies, labor organizations, and licensing agencies treat genetic testing and genetic information in such a manner that is consistent with the requirements of federal law. Section 25(b) indicates that employers may release genetic testing information only in accordance with GIPA. According to Section 25(c), an employer, employment agency, labor organization, and licensing agency shall not directly or indirectly:

Solicit, request, require or purchase genetic testing or genetic information of a person or a family member of the person, or administer a genetic test to a person or a family member of the person as a condition of employment, preemployment application, labor organization membership, or licensure;
Affect the terms, conditions, or privileges of employment, preemployment application, labor organization membership, or licensure, or terminate the employment, labor organization membership, or licensure of any person because of genetic testing or genetic information with respect to the employee or family member, or information about a request for or the receipt of genetic testing by such employee or family member of such employee;
Limit, segregate, or classify employees in any way that would deprive or tend to deprive any employee of employment opportunities or otherwise adversely affect the status of the employee as an employee because of genetic testing or genetic information with respect to the employee or a family member, or information about a request for or the receipt of genetic testing or genetic information by such employee or family member of such employee; and
Retaliate through discharge or in any other manner against any person alleging a violation of this Act or participating in any manner in a proceeding under this Act.

Conclusion

Please join us tomorrow for the final post in our week-long focus on GIPA, where we will discuss GIPA’s impact on other types of litigation, potential defenses for companies named in GIPA litigation, and considerations for companies doing business in Illinois that may fall within GIPA’s purview.

From BIPA to GIPA: Another Four-Letter Word in Illinois Class Action Litigation, Part 3

07 Feb 2024

Today, we examine the remedies available under GIPA:

Definition of an “Aggrieved” Person

Like the Illinois Biometric Information Privacy Act (“BIPA”), GIPA allows any person “aggrieved” by a violation of the Act to file a civil lawsuit. Neither Act defines what constitutes “aggrieved.” In 2022, the District Court for the Southern District of Illinois applied the definition of an “aggrieved person” used by the Illinois Supreme Court in a BIPA lawsuit to GIPA. Bridges v. Blackstone, No. 21-cv-1091-DWD, 2022 U.S. Dist. LEXIS 121205 (S.D. Ill. July 8, 2022). In Bridges, the court specifically relied on the Illinois Supreme Court’s opinion in Rosenbach v. Six Flags Ent. Corp., 2019 IL 123186, previously discussed here. In Rosenbach, the Illinois Supreme Court determined that an individual does not need to allege some actual injury or adverse effect, beyond violation of his or her rights under BIPA, to state a claim under BIPA. The court in Bridges reasoned that although BIPA and GIPA differ significantly in scope, they have identical enforcement provisions. Under Illinois law, a statute should be construed in conjunction with other statutes touching on the same or related subjects considering the reason and necessity of the law, the evils to be remedied, and the objects and purposes to be obtained.

The Bridges court also believed that the Illinois Supreme Court’s “broad reading” of “aggrieved person” in Rosenbach was consistent with Illinois’ understanding of the term “aggrieved,” which has been defined as “having a substantial grievance; a denial of some personal or property right.” If Illinois state courts adopt the reasoning of the Bridges court and the Illinois Supreme Court’s interpretation of “aggrieved person” in the BIPA litigation context, plaintiffs will be able to pursue GIPA lawsuits without needing to allege or establish an actual injury or harm.

Recovery Provisions

Also, like BIPA, GIPA provides for recovery of liquidated damages; recovery of reasonable attorneys’ fees and costs, including expert witness fees; and injunctive relief. 410 ILCS 513/40. Importantly, the Act also specifies that the damages may be recovered “for each violation.” This language is one of several provisions that make BIPA such dangerous legislation for defendants, as plaintiffs’ attorneys argue that their clients are entitled to recover $1,000 or $5,000 (BIPA’s liquidated damages amounts) for each, individual violation of BIPA by a defendant rather than as one lump sum. GIPA provides liquidated damages of $2,500 against any party who negligently violates a provision of the Act and $15,000 for any party who intentionally or recklessly violates a provision of the Act.

GIPA contains an exclusive remedy provision applicable to insurers for certain types of GIPA claims. In cases alleging that an insurer violated Section 30 of GIPA, the Illinois Insurance Code provides the exclusive remedy. GIPA defines “insurers” as: 1) an entity that is subject to the jurisdiction of the Director of Insurance; and 2) a managed care plan. 410 ILCS 513/10. A “managed care plan” means a plan that establishes, operates, or maintains a network of health care providers that have entered into agreements with the plan to provide health care services to enrollees where the plan has the ultimate and direct contractual obligation to the enrollee to arrange for the provision of or pay for services through: 1) organizational arrangements for ongoing quality assurance, utilization review programs, or dispute resolution; or 2) financial incentives for persons enrolled in the plan to use the participating providers and procedures covered by the plan.

Like BIPA, GIPA contains no statute of limitations provision. As previously discussed here, the Illinois Supreme Court decided in 2023 that the Illinois five-year “catchall” statute of limitations applies to BIPA claims. The court likely will be asked to similarly resolve this issue in the context of GIPA litigation.

Conclusion

As part of our continuing discussion of GIPA, tomorrow we will address GIPA lawsuits, focusing on those filed against insurers and employers, the types of defendants most frequently named in this litigation.

From BIPA to GIPA: Another Four-Letter Word in Illinois Class Action Litigation, Part 2

06 Feb 2024

Today, our focus is on GIPA’s key definitions and the Act’s confidentiality provisions:

Key Definitions

To understand GIPA’s requirements, it is imperative to understand GIPA’s definitions. GIPA contains a definitions section, which expressly defines certain terms used in the Act and adopts definitions specified in federal regulations for other terms. 410 ILCS 513/10. There are too many definitions to address in this post, but below are definitions for some of the bedrock terms used in GIPA. In our discussion of GIPA lawsuits later this week, we will examine some other important definitions contained in GIPA.

Under GIPA, “genetic information” has the same meaning as that term is used in HIPPA and defined by federal regulation. HIPPA defines the term to include: 1) an individual’s genetic tests; 2) genetic tests of family members of an individual; and 3) the manifestation of a disease or disorder in family members of such individuals. 45 C.F.R. 160.103. GIPA defines “genetic testing” and a “genetic test” to have the same meaning ascribed to “genetic test” under HIPPA, as specified by federal regulation. The applicable federal regulation defines “genetic test” as an analysis of human DNA, RNA, chromosomes, proteins, or metabolites, if the analysis detects genotypes, mutations, or chromosomal changes. The regulation specifies that “genetic test” does not include an analysis of proteins or metabolites that is directly related to a manifested disease, disorder, or pathological condition. “Manifested” means, with respect to a disease, disorder, or pathological condition, that an individual has been or could reasonably be diagnosed with the disease, disorder, or pathological condition by a healthcare professional with appropriate training and expertise in the field of medicine involved. 45 C.F.R. 160.103. GIPA defines the “family member” of an individual as: 1) the spouse of the individual; 2) a dependent child of the individual; 3) any other person qualifying as a covered dependent under a managed care plan; and 4) all other individuals related by blood or law to the individual, the spouse of the individual, or the dependent child of the individual.

Confidentiality Provisions

GIPA contains multiple provisions governing the confidentiality of genetic information and genetic testing. The confidentiality provisions are far-reaching. They impact employers, insurers, civil and criminal litigants, governmental agencies, and health care providers, among others. For example, Section 15(a) indicates that except as otherwise provided in the Act, genetic testing and information derived from genetic testing is confidential and privileged and may be released only to the individual tested and to persons specifically authorized in writing in accordance with Section 30 of GIPA.

According to Section 30(a), no person may disclose or be compelled to disclose the identity of any person upon whom a genetic test is performed or the results of a genetic test in a manner that permits identification of the test subject, except to certain specified individuals, including: 1) the subject of the test or the subject’s legally authorized representative; 2) any person designated in a specific written legally effective authorization for release of the test results executed by the subject of the test or the subject’s legally authorized representative; 3) an authorized agent or employee of a health facility or health care provider if the health facility or health care provider itself is authorized to obtain the test results, the agent or employee provides patient care, and the agent or employee has a need to know the information in order to conduct the tests or provide care or treatment; 4) reasonable effort must be made to notify the parent or legal guardian of a minor under 18 years of age if the health care provider, professional, or facility who ordered the test believes notification would be in the best interest of the minor and the provider, professional, or facility first sought unsuccessfully to persuade the minor to notify the parent or legal guardian.

GIPA also makes all information and records held by a State agency, local health authority, or health oversight agency pertaining to genetic information “strictly confidential” and exempt from copying and inspection under FOIA. 410 ILCS 513/30(b). Subject to limited exceptions, including the written consent of all persons to whom the information pertains, the information and records shall not be released or made public.

Pursuant to GIPA, no person to whom the results of a test have been disclosed may disclose the test results to another person except as authorized by the Act. 410 ILCS 513/35. In other words, if you receive test results governed by GIPA, you should not assume that because disclosure was authorized in one instance that you are similarly authorized to disclose the results. Rather, you must determine whether you qualify for one of the exceptions to GIPA’s confidentiality provisions before disclosing the results.

GIPA includes some limitations on its confidentiality requirements. For example, insurers will be deemed in compliance with Section 30 if they make disclosures in accordance with Article XL of the Illinois Insurance Code. 410 ILCS 513/30(c). Additionally, results of genetic testing that indicate the individual tested is at the time of the test afflicted with a disease, whether or not currently symptomatic, are not subject to the confidentiality requirements of GIPA. 410 ILCS 513/15(d).

Conclusion

Tomorrow, we turn our focus to the rights and remedies provisions of GIPA. Stay tuned, as these are the provisions allowing for the recent surge in GIPA class action filings.

From BIPA to GIPA: Another Four-Letter Word in Illinois Class Action Litigation, Part 1

05 Feb 2024

Today, we examine the background of GIPA:

As discussed in prior Baker Sterchi blog posts, including here, here, and here, the Illinois Biometric Information Privacy Act (“BIPA”) has dominated the Illinois class action landscape for several years. There are no signs of BIPA litigation slowing down. Rather, five times as many BIPA lawsuits were filed in 2022 compared to 2018, and over 400 BIPA lawsuits were filed in Illinois in 2023.

There is another four-letter statute, however, of which companies doing business in Illinois should be aware: GIPA. GIPA, or the Genetic Information Privacy Act, was enacted in 1998. GIPA was amended in 2008, in part, to align with certain provisions of the federal Genetic Information Nondiscrimination Act of 2008. According to the legislative intent section of GIPA, many members of the public were deterred from seeking genetic testing because of fear that test results would be disclosed without consent in a manner not permitted by law or would be used in a discriminatory manner. Additionally, the legislature stated an intent that disclosure of genetic information required under the Health Insurance Portability and Accountability Act (“HIPPA”) be performed in accordance with HIPPA’s “minimum necessary standard.”

Until recently, few GIPA lawsuits were filed. According to our research, only two GIPA class action lawsuits were filed in 2021, and zero were filed in 2022. By contrast, 30 GIPA class action lawsuits were filed in 2023. What led to this surge in filings? Likely several factors, including the similarity of the right of action and remedy provisions in GIPA and BIPA, which we will further discuss later this week. Another likely factor is the recent approval of a class and subclass of plaintiffs in a GIPA suit by the District Court for the Northern District of Illinois. On August 3, 2023, the court granted the plaintiff’s motion for class certification in a case alleging that Sequencing, LLC violated GIPA by disclosing its customers’ genetic information to unknown third-party developers without first obtaining those customers’ consent. Melvin v. Sequencing, LLC, 344 F.R.D. 231 (N.D. Ill. 2023).

Tomorrow, we will examine GIPA’s key definitions and the Act’s confidentiality requirements. On Wednesday, we will evaluate the remedies available under GIPA. On Thursday, we will address GIPA lawsuits, focusing on those filed against insurers and employers, the types of defendants most frequently named in this litigation. Finally, on Friday, we will discuss considerations for defendants named in GIPA litigation and for companies doing business in Illinois.

No Coverage for BIPA Claims Due to "Violation of Statute" Exclusion

01 Feb 2024

ABSTRACT: In a declaratory judgment action filed by two CGL carriers, the Illinois Court of Appeals was presented with the issue of whether the insurers owed a duty to defend against claimed violations of the Biometric Information Privacy Act ("BIPA").

According to the complaint, the insured "collected, stored, used, or disseminated" the fingerprints of an employee without his consent and without any policies in place regarding the retention and deletion of his fingerprints from the database. In addition, the complaint alleged that the insured failed to inform the insured how his biometric information would be used, and that it failed to obtain a release for the use of such information.

The subject policies excluded from coverage injury arising out of a violation of any statute that "addresses, prohibits or limits the printing, dissemination, disposal, collecting, recording, sending, transmitting, communicating or distribution of material or information."

In a detailed analysis of this exclusion, the court concluded that the "catch-all" provision of the "violation of statute" exclusion was sufficiently related to the theme of protecting personal privacy such that it would apply to defeat coverage, and that the insurers owed no duty to defend the BIPA claims.

The court addressed at length the recent decision of Citizens Insurance Co. of America v. Wynndalco Enterprises, LLC, 70 F4th 987, 997 (7th Cir. 2023), which deemed the "violation of statute" exclusion ambiguous under nearly identical facts and policy language.

Aside from the fact that the title of the "violation of statute” exclusion in the Wynndalco policy was less descriptive of the privacy interests at stake in a BIPA claim, the state court simply disagreed with the 7th Circuit's approach to policy interpretation. In particular, the court took issue with the 7th Circuit's contention that the exclusion eviscerated all coverage for "personal and advertising injury", and that the exclusion was in conflict with other language of the policy conferring coverage.

"[I]t is improper," the court explained, "to comb the policy for other conflicts or ambiguities and use them to rule on the language before us. [...] If the court were allowed to do that, then every insurance coverage case would turn into an overall referendum on the policy as a whole, rather than a pinpoint analysis of a particular coverage provision verses a particular exclusion." Nat'l Fire Ins. Co. of Hartford v. Visual Pak Co., 2023 Ill. App. LEXIS 482, **49.

Because the insurers owed no duty to defend, the court rejected the argument of the insured's assignee that they were estopped from denying coverage due to a failure to defend under a reservation of rights or promptly file a declaratory judgment action. "[E]stoppel does not even factor into the equation of the court ultimately determines that the insurer owed no duty to defend." Id. at **50. “[T]o allow the estoppel question to precede the duty-to-defend question,” the court noted, "would be to give estoppel the power to magically rewrite a policy from one that does not obligate the insurer to defend into one that does." Id. at **53.

This decision is a well-constructed argument that touches on many important concepts of insurance policy interpretation.

Nat'l Fire Ins. Co. of Hartford v. Visual Pak Co.

Appellate Court of Illinois, First District, Second Division

December 19, 2023, Decided

2023 IL App (1st) 221160 *; 2023 Ill. App. LEXIS 482 **

"Judicial Hellholes" – Cook County rises to number 2 while St. Louis, St. Clair and Madison County Hold Steady

29 Dec 2023

ABSTRACT: Cook County, Illinois jumps from number 5 to number 2 in the country on the 2023/2024 American Tort Reform Foundation’s “Judicial Hellholes Report,” with the help of BIPA, while St. Louis, Missouri, St. Clair and Madison County Illinois hold their ground thanks to asbestos litigation.

Cook County, Illinois moved up significantly within the top 10, now ranked as the second worst Judicial Hellhole, as Illinois courts and legislature continue to fortify the jurisdiction as one of the most plaintiff-friendly jurisdictions across the United States.

As we anticipated from last year’s trends, filings of “no injury” Biometric Information Privacy Act (“BIPA”) litigation have choked Illinois courts, with seminal rulings in 2023 setting the stage for spurring filings even higher. This legislation requires companies to inform an individual in writing and receive a written release prior to obtaining or retaining personal biometric data, setting statutory minimum damages from $1000 to $5000 to automatically be awarded for each BIPA violation, regardless of the actual injury suffered. February 2023 saw the Illinois Supreme Court expand the statute of limitations for BIPA lawsuits beyond the one-year default limitation period for privacy actions, to a five-year statute of limitations. Tims v. Black Horse Carriers, Inc., 2023 IL 127801, 216 N.E.3d 845 (2023).

Mere weeks later, also in February 2023, the Illinois Supreme Court exponentially expanded potential BIPA liability claims, by ruling that a BIPA claim is created each time a business scans the person’s biometric information and each time it is transmitted to a third party. Cothron v. White Castle System, 2023 IL 128004, 216 N.E.3d 918 (2023). Previously claims were only created for the initial scan and initial transmission to a third-party, but now under the Court’s ruling, new violations are created each time an employee logged into a work computer system, multiplying the viable claims hundreds or thousands of times over per employee. The plaintiffs’ bar has been paying close attention to these rulings, as BIPA filings spiked 65% in the next two months after these decisions. BIPA suits have proven so lucrative that the Illinois Supreme Court has also signaled that it will not be swayed by policy arguments related to increasing excessive verdicts from this litigation, instead punting the issue to be addressed by the legislature.

Based on laws passed by the Illinois legislature and enacted by Governor J.B. Pritzker in 2023, it does not appear that any help will be forthcoming to Illinois businesses from the legislature. In August, Governor Pritzker signed into law H.B. 219, which was fast-tracked through both houses of Illinois’ Congress on a wave of support by the Illinois plaintiffs’ attorneys’ bar association and prominent Cook County plaintiffs’ firms. This law amended Illinois’ wrongful death statute to allow for the recovery of punitive damages in most wrongful death cases. Unlike many other jurisdictions, Illinois also does not cap punitive damages generally, so the Illinois amended Wrongful Death Act now provides a forum unique to most other jurisdictions where unlimited punitive damages can now be sought in wrongful death actions. At the same time, Governor Pritzker also signed H.B. 2231 into law, removing liability protections against rideshare companies like Uber and Lyft, newly categorizing such companies as common carriers, who are now subject to vicarious liability for accidents resulting from their employee drivers.

Illinois courts’ rulings and the enactment of these new laws will likely only exacerbate the already high number of case filings and exceedingly high jury verdict awards. Illinois verdicts have historically been some of the highest in the country on average, even before the COVID-19 pandemic of 2020, ranking as high as fourth place in number of nuclear verdicts over $10 million. However, in September 2023 a Cook County jury set the Illinois record for the largest verdict for a single plaintiff in a personal injury action, awarding $363 million including $325 million in punitive damages. Susan Kamuda and Edward Kamuda et. al. v. Sterigenics U.S. LLC, et. al.No. 2018L010475. These recent court rulings and laws enacted all but make certain that this new record will soon be eclipsed.

Illinois’ courts’ rulings and newly enacted laws along with the already vibrant asbestos litigation throughout Illinois is why both Madison County and St. Clair County are, yet again this year, on the judicial hellhole “Watch list.”

Although Madison County and St. Clair County have fallen off the list, St. Louis has also held strong at number 8 for the last two years thanks to the junk science that has been allowed in cases involving Monsanto and its Roundup week killer, talc, and asbestos cases. But the juries are not just giving nuclear verdicts when junk science is involved. The Karen Chaplin et al v United Brands Products Design Development et al, 20SL-CC06071, known as the ‘Whip-it’ case, is a great example of the nuclear verdicts coming out of St. Louis. In September, a jury awarded $745 million to the parents of a 25-year-old woman killed on a sidewalk outside an urgent care center by a driver who huffed nitrous oxide canisters, “Whip-it”, right before the accident. The two-week case focused on United Brand Products distributing nitrous oxide under the name Whip-It and their conspiracy with a smoke shop to sell the product to customers they knew intended to illegally inhale the gas to get high. The jury bought into the plaintiffs’ argument that United Brands Products should be held responsible for the illegal use of their legal product Whip-It by Mr. Geiger, assessing 70% of the $745 million verdict to United Brands Products.

The Missouri Legislature is not helping as legislative reform has stalled and bills like S.B. 31 get pushed through thanks to the help of the plaintiffs’ bar. S.B. 31 included an overhaul of the collateral source rule in Missouri. It opens a loophole to inflate damages by allowing plaintiffs’ lawyer to introduce evidence of inflated medical bills to show the severity of plaintiff’s injuries, rather than the actual amount of damages sought. This causes “Phantom Damages,” an inflated damages award.

Illinois and Missouri have a long road ahead of them in order to get off the “hellhole list,” and this can only be accomplished through enacting stricter reforms that limit lawsuit abuse, and judiciaries who maintain a sense of balance.

Illinois and Missouri are not the only States with issues. The national ‘hellhole list’ is led by Georgia, the Philadelphia Court of Common Pleas, and the Supreme Court of Pennsylvania, tied at the top; and Cook County, Illinois moving up the list (#2). Holding strong at their previous status are California (#3), New York (#4), South Carolina asbestos litigation (#5), and Louisiana (#7). New to the list is Lansing, Michigan (#6) earning thanks to the Michigan Supreme Court and Michigan Legislature expanding premises and workplace liability and adopting an expansive approach to medical liability.

The upcoming year will show if Mallory v Norfolk Southern Railway Co. opens the doors for these already plaintiffs’ friendly jurisdictions. Plaintiffs’ now have the ability to drag out-of-state defendants into ‘hellholes’ that have little or no connection to the case at hand.

Illinois Expands Law to Allow Punitive Damages for Wrongful Death and Survival Plaintiffs

04 Oct 2023

ABSTRACT: In a move that may further exacerbate the growing “nuclear verdict” issue in Illinois, plaintiffs will now be permitted to seek punitive damages from defendants under the Wrongful Death Act and Survival Act. While this law may be challenged on constitutionality grounds in the near future, we examine the history of this new amendment and its potential impact to businesses in Illinois.

For the first time in its history, Illinois approved an amendment expanding punitive damages recovery to Plaintiffs under the Wrongful Death and Survival Acts. Previously, Illinois courts held that punitive damages rights belonged to the injured person alone and such rights ceased on the death of the injured person. After Illinois Gov. JB Pritzker signed House Bill 219 into law on August 11, 2023, amending 740 ILCS 180/1, 740 ILCS 180/2, and 755 ILCS 5/27-6, Illinois plaintiffs may now seek to recover punitive damages in wrongful death or survival actions.

Although similar legislation had been presented many times previously in prior general assemblies, House Bill 219 was rushed through both Illinois houses, passing within one week of state Rep. Jay Hoffman (D – Swansea) becoming chief sponsor of the bill, reportedly spurred on by recent strong support from the Illinois Trial Lawyers’ Association (ITLA), including from then-president of ITLA Pat Salvi, Jr., who personally argued in favor of House Bill 219 to an Illinois Senate Panel.

Opponents of House Bill 219 have indicated future challenges to the constitutionality of this amendment may likely be raised in the coming months. As it stands now, defendants sued in Illinois may face the prospect of juries awarding higher, more frequent verdicts over $10 million (commonly referred to as a “nuclear verdict”) to include these new damages available. Those juries are now faced with the task of setting a dollar amount on the punitive punishment of a defendant for the death of an injured party, in addition to the compensatory damages for that same injury and death. Comparing punitive damages awarded to a living injured person to those now permitted to be awarded following the death of an injured party, juries may award higher punitive damages for the latter, where juries may be persuaded that punitive punishment should be greater against a party where death results from a defendant’s conduct, compared to the similar conduct resulting in injury but not death.

As many times punitive damages are not covered by any insurance policies, the risk to businesses sued in Illinois courts is now increased in a way that may be challenging to mitigate in advance. This change may also harm small businesses disproportionally, as a punitive damages verdict may have the potential to bankrupt and shut down companies that cannot absorb such a financial loss. As Illinois Rep. Dan Ugaste (R – 65^th District) argued in a House Judiciary Committee hearing opposing House Bill 219, entire businesses could be shuttered due to the actions of “one or two bad actors,” potentially punishing employees and investors who had no role in or knowledge of the conduct leading to the lawsuit.

It is important to note however, that Illinois has not changed the standard for pleading punitive damages. Prior to pleading such damages and before a plaintiff would be permitted to ask a jury for punitive damages, Illinois law still requires the plaintiff to seek leave from the Court and demonstrate to the Court that the plaintiff has a “reasonable likelihood of proving facts at trial sufficient to support an award of punitive damages.” As the Illinois Supreme Court has previously held that caps on punitive damages were unconstitutional, House Bill 219 does not contain any such limitations. House Bill 219 also retains the exemptions related to suits against doctors, lawyers, and public entities, under 735 ILCS 5/2-1115, 745 ILCS 10/2-102, and 745 ILCS 10/2-213.

Many observers see this amendment most significantly impacting toxic tort litigation, particularly in cases involving asbestos. In such cases, plaintiffs have alleged in prior punitive damages claims that a particular company or industry knew of the hazards of asbestos but did not provide any warnings and continued to use or manufacture products containing asbestos despite knowing of potential dangers. In Madison County, Illinois, one of the largest dockets in the country for asbestos claims, we are prepared to help clients navigate the local rules of Madison County regarding punitive damages in asbestos cases impacted by this amendment.

Jury verdicts, both in Illinois and across the country, have been notably higher since courtrooms re-opened following the COVID-19 pandemic and during this time of increased economic inflation. As such, it would not be surprising to see an increased number of punitive awards and potentially higher punitive awards. In any case where there is a potential for punitive damages to be sought, particularly in cases where the injured party is deceased or may not survive through trial, businesses sued in Illinois should be aware of the increased risk and new category of damages available created by Illinois’ passage of House Bill 219 amending Illinois’ Wrongful Death Act and Survival Act.

Questions Regarding the Extent of Damages Available Under BIPA Remain Following Recent Rulings by Illinois Supreme Court and District Court for the Northern District of Illinois

07 Aug 2023

ABSTRACT: Recently, the Illinois Supreme Court declined to revisit its holding in Cothron v. White Castle System. While that case garnered significant attention due to the court’s ruling that BIPA violations accrue, and the statute of limitations runs separately, each time a defendant violates an individual’s rights under the Act, another important aspect of the case involved the amount of damages available under BIPA. In refusing to grant White Castle’s petition for rehearing, the court provided no additional guidance on this issue. An Illinois District Court, relying on the Cothron opinion, recently vacated a damages award and ordered a new trial on the issue of damages in the first BIPA lawsuit to go to trial.

Cothron v. White Castle System, Inc.:

As discussed here, on February 17, 2023, the Illinois Supreme Court issued its long-awaited opinion in the case Cothron v. White Castle System, Inc., 2023 IL 128004. In that case, the court held that: 1) an entity violates Section 15(b) of the Biometric Information Privacy Act (“BIPA”) each time it collects, captures, or otherwise obtains a person’s biometric information without prior informed consent; and 2) a claim under Section 15(d) accrues upon each transmission of a person’s biometric information without prior informed consent. The court rejected the defendant’s argument that an individual’s claims under Sections 15(b) and (d) accrue only once – and the statute of limitations, therefore, begins running solely – at the time a defendant first violates the individual’s rights under those sections.

While, on its face, Cothron addressed when claims under BIPA accrue for purposes of the statute of limitations, the court also discussed the scope of damages available under BIPA. White Castle argued that the court’s ruling would result in “astronomical” damages awards tantamount to “annihilative liability.” Specifically, White Castle reasoned that the court’s interpretation of BIPA would result in plaintiffs seeking separate awards of $1,000 or $5,000 – the liquidated damages amounts provided for by BIPA – for each individual violation of the Act. In rejecting this argument, the court explained that the Illinois legislature made damages discretionary rather than mandatory under BIPA. The court further noted that there is no language in BIPA suggesting a legislative intent to authorize damages that would result in the financial destruction of a business. Simultaneously, however, the court stated that the legislature intended for entities who violate BIPA to face “substantial potential liability,” even if the consequences may be harsh, unjust, absurd, or unwise.

Subsequently, White Castle filed a petition for rehearing. On July 17, 2023, the Illinois Supreme Court denied White Castle’s petition without issuing an opinion. Justice David Overstreet, who dissented from the original opinion, issued a separate dissenting opinion upon the denial of White Castle’s petition. The dissent was joined by Justices Theis and Holder White. In the dissent, Justice Overstreet indicated that he would have allowed rehearing to address White Castle’s argument that the court’s opinion resulted in an erroneous interpretation of BIPA that subverted the intent of the Illinois legislature, threatened the survival of businesses in Illinois, and raised significant constitutional due process concerns.

Justice Overstreet explained that the Illinois legislature intended BIPA to be a remedial, as opposed to penal, statute. To that end, damages under BIPA are the greater of actual damages or liquidated damages. Justice Overstreet thought the damages provision indicative of the fact that liquidated damages are to be awarded where actual damages are too small and difficult to prove, not as a multiplier by thousands for each time technology is used. He noted, however, that the majority’s construction of BIPA, where a claim accrues under the Act with each scan of a finger and each transmission of biometric information to technology vendors, will lead to results that “vastly exceed reasonable ratios between the damages awarded and the offense at issue.”

The dissent examined the plaintiff’s potential damages to illustrate its point. The plaintiff scanned her finger each time she accessed a work computer and each time she accessed her weekly pay stub. Assuming she worked 5 days per week for 50 weeks per year and scanned her finger 6 times per week, her total scans equaled at least 1,500 over the five-year statute of limitations period. If she was awarded $5,000 per scan, her total damages would exceed $7 million despite the fact that the plaintiff had not alleged a data breach or any damages associated with identity theft or compromised data. The dissent noted that the excessive nature of the plaintiff’s damages was exacerbated in the class-action context. Thus, the dissent believed that the majority interpreted BIPA in such a way that the Act was converted from a remedial statute to a penal one, in violation of Illinois law. See, People v. Nastasio, 19 Ill.2d 524, 529 (Ill. 1960) (it is the court’s duty to interpret a statute so as to promote its essential purpose and to avoid, if possible, a construction that would raise doubts as to its validity).

The dissent also believed that the majority’s interpretation of BIPA raised serious due process concerns. As the dissent explained, a statute violates the Due Process Clause when it authorizes an award that is so severe and oppressive as to be wholly disproportioned to the offense and obviously unreasonable. Turning again to the facts of Cothron, the dissent noted that White Castle estimated that if the plaintiff was successful and allowed to bring her claims on behalf of as many as 9,500 current and former employees, damages could exceed $17 billion. The dissent suggested that such damages “could toll the death knell for even large, financially successful businesses.”

The dissent next addressed the practical effect of the majority’s opinion. For example, it noted that the lead plaintiff in Rogers v. BNSF Ry. Co., the first BIPA lawsuit tried to verdict, which resulted in a $228 million verdict, argued that the verdict amount should be multiplied based on the majority’s holding in Cothron. Additionally, cases alleging violations of BIPA had increased 65 percent since the Cothron ruling.

Moreover, the dissent believed that the astronomical damages potentially available based on the majority’s holding would be grossly disproportionate to the alleged harm BIPA seeks to redress. In fact, the risk of harm BIPA was enacted to prevent appears not to have materialized yet. According to amici, in the more than 1,700 BIPA lawsuits filed since 2019, no case involved a plaintiff alleging that his or her biometric data had been subject to a data breach or led to identity theft.

The dissent next addressed what it considered the majority’s “inconsistent conclusions” concerning the legislative intent underlying BIPA. According to the dissent, the majority determined that BIPA’s language was clear while simultaneously suggesting the need for clarification by the legislature. The majority specifically suggested that the legislature review the policy concerns raised by White Castle and make clear its intent regarding the assessment of damages under BIPA. The dissent, however, believed that the legislature’s intent regarding the assessment of damages under BIPA was clear. Namely, the dissent opined that the legislature’s intent was for a “one-time scan” interpretation of BIPA.

Ultimately, the dissent believed a rehearing should have been granted to determine if the resulting penalty to Illinois businesses would pass constitutional scrutiny. At a minimum, the dissent believed White Castle’s petition for rehearing should have been allowed in order to clarify paragraphs 40 through 43 of the majority’s opinion. Those paragraphs contained the majority’s discussion of White Castle’s policy arguments regarding damages, and, according to the dissent, highlighted the conflicts resulting from the majority’s construction of BIPA.

The dissent ended by highlighting the need for a rehearing to provide clarity to Illinois courts and to litigants. As the dissent explained, “no guidance or criteria remain for who pays nothing and who suffers annihilative liability.” Additionally, without guidance regarding the standard for setting damages, defendants, in class actions especially, remain unable to assess their realistic potential exposure.

Rogers v. BNSF Ry. Co.:

Perhaps illustrating the dissent’s concerns in Cothron, in Rogers v. BNSF Ry. Co., No. 19 C 3083, 2023 U.S. Dist. LEXIS 113278 (N.D. Ill. June 30, 2023), the District Court for the Northern District of Illinois ordered a new trial on damages following the first jury verdict in a BIPA lawsuit. In October 2022, the jury returned a verdict in favor of the plaintiff class, finding that BNSF had recklessly or intentionally committed 45,600 violations of BIPA. The court did not submit the question of the amount of damages to the jury. Rather, the court found that a monetary award under BIPA is a liquidated amount that depends on the jury’s findings regarding intent (i.e., whether the defendant acted negligently or recklessly/intentionally). In other words, the court did not believe it, or the jury, had discretion regarding the amount of damages available if the jury found for the plaintiff class. Thus, the court instructed the jury to determine the number of BIPA violations and the question of intent. Following the jury’s verdict, the court entered a judgment in favor of the plaintiff class in the amount of $228 million (45,600 times $5,000).

In its motion, BNSF argued that the jury should have decided the amount of damages. BNSF further argued that the $1,000 and $5,000 liquidated damages amounts referenced in BIPA were not mandatory. Rather, BNSF claimed that courts or juries could award any amount up to $1,000 for a negligent violation and any amount up to $5,000 for an intentional or reckless violation.

While the court noted that no Illinois court had squarely addressed BNSF’s argument, the court cited the Illinois Supreme Court’s opinion in Cothron, specifically its language that “it also appears that the General Assembly chose to make damages discretionary rather than mandatory under [BIPA].” Although the plaintiff claimed that this language was dicta, the court reasoned that dicta from the Illinois Supreme Court was “good evidence” of how the court would rule on the issue.

Based upon the language from Cothron, the court determined that damages under BIPA are discretionary and, therefore, a question for the jury. Thus, the court partially granted BNSF’s motion for a new trial, vacated the award of damages, and ordered a new trial limited to the question of damages.

Cotton Court Confers Constitutionality to Prejudgment Interest in Illinois First District Appeal

20 Jul 2023

ABSTRACT: In what will likely be the first of multiple challenges to the constitutionality of Illinois’ newly codified Prejudgment Interest Amendment to 735 ILCS 5/2-1303, the Illinois First District Appellate Court in Cotton v. Coccaro, 2023 IL App (1st) 220788, held the Amendment was constitutional. We break down the rationale behind the decision, discuss what this ruling means for the future of opposition to this new Amendment, and provide guidance as to the continuing impact prejudgment interest will have on businesses sued in Illinois.

Less than 24 months after it was enacted, the Illinois Prejudgment Interest Amendment to 735 ILCS 5/2-1303 was challenged on appeal in the Illinois First District Appellate Court in the Cotton v. Coccaro case, with the Court ultimately siding with the plaintiffs’ arguments as to the constitutionality of the Amendment, upholding the prejudgment interest award against the trial defendants.

The Amendment went into effect on July 1, 2021, providing for statutory 6% per year pre-judgment interest to be recovered by a plaintiff on all judgment damages including future damages, with the exception of punitive damages, sanctions, statutory attorney’s fees, and statutory costs. The total prejudgment interest is then added to the judgment amount to be paid by the judgment defendant(s).

While Illinois had historically permitted post-judgment interest to be accrued on unpaid judgment debt, the Amendment created a wholly separate prejudgment interest to be paid to plaintiffs upon receiving a judgment against the trial defendants.

The Court held the Amendment did not infringe on defendants’ right to a jury trial, that prejudgment interest does not circumvent due process or amount to double recovery over the jury verdict for a single injury, and that the Amendment does not constitute special legislation as the it bears a rational relationship to the legitimate governmental interest of promoting expeditious settlement of tort claims to ease the burden on the court system. The Court also brushed aside a challenge to the Amendment under separation of powers analysis and arguments as to technical violations by the General Assembly’s procedure in enacting the bill. Finally, the retroactive application of the Amendment to the active cases that filed prior to the enactment of the Amendment was upheld and similarly found to be constitutional.

The appealing defendants challenged the Amendment’s constitutionality on multiple grounds, including that it invades the jury’s exclusive province to determine damages awarded at trial, that the prejudgment interest constitutes double recovery for a single injury in violation of due process, that the Amendment excludes certain tort plaintiffs or discriminates against defendants joined after the expiration of the one-year deadline under the Amendment, as well as challenging the retroactive application of the law and raising other technical violations by the General Assembly. The Cotton Court ruled against the appealing defendants, finding none of the issues raised made the Amendment unconstitutional.

One issue that was not raised by the appeal in the Cotton case was the lack of clarity of the practical application of how prejudgment interest is to be divided under joint and several liability, with regard to insolvent or non-paying defendants, setoffs of prior settlements by former defendants or nonparties, or other circumstances where it is murky as to who will be ultimately responsible for payment of prejudgment interest under joint and several liability. Also not addressed was how the Amendment allows plaintiffs to delay progress of their case to recover higher amounts of prejudgment interest as no provision addresses tolling for delays in the case caused by the plaintiff. Equally the appeal did not address how the plain language of the Amendment continues to provide an imbalance between the parties, with plaintiffs permitted to make time limited demands, but defendants being forced to leave open offers for 90 days or until explicit rejection. As these issues were not raised in the Cotton case, those questions would not be at issue to any further appeal by the Cotton defendants. Given the lack of clarity on these issues however, it will likely only be a matter of time until guidance is sought on appeal in another case.

Given the constitutional challenges to this Amendment, it seems likely that eventually these issues will be ultimately ruled on by the Illinois Supreme Court to create clarity in all Appellate Districts, whether by the Cotton defendants or another defendant impacted by the Amendment.

Businesses sued in Illinois, particularly within the First District, will continue to face difficulties created by the Amendment, including that the short timeframe required by the Amendment for compliance means that many claims are not fully investigated by the expiration of the statutory deadline, encouraging settlements without fully developing the evidence. As the Amendment will continue to be in effect in Illinois, businesses sued in Illinois will face a challenging path to navigate compliance with the statutory language to avoid or reduce application of the Amendment against a judgment.