The regulation of the collection and use of biometric data has become more prevalent. While some of these laws have existed for quite some time, they came into the spotlight more recently due to the class action lawsuits filed under the Illinois Biometric Information Privacy Act (BIPA). As a result, there has been a significant pull back in insurance coverage for these types of claims. While several states have introduced legislation similar to BIPA, below we will review the New York City and Portland laws as they both provide a private right of action. We will also provide an overview of where insurance coverage currently stands for these claims.
The NYC Biometric Law went into effect on July 9, 2021 and requires a commercial establishment (a “commercial establishment” is defined as a place of entertainment, a retail store, or a food and drink establishment) that “collects, retains, converts, stores or shares” biometric identifier information to have clear signage near all of the commercial establishment’s customer entrances notifying the customers that they are collecting such data.1 It further prohibits these establishments from selling or sharing the information collected with third parties. Most importantly, similar to BIPA, the NYC Biometric Law provides for a private right of action for any aggrieved individual. However, prior to filing an action the aggrieved party must provide the commercial establishment with 30 days written notice to remedy the violation. No prior notice is required for violations of the second part of the NYC Biometric Law, which prohibits the sale of biometric identifier information.
The NYC Biometric Law exempts government agencies, employees and agents entirely. It also exempts financial institutions, but only from the signage requirement. Thus, litigation may still be brought against a financial institution who shares collected biometric identifier information.
The Portland Ordinance prohibits private entities from using face recognition technologies in “places of public accommodation”.2 A “place of public accommodation” is defined as, “[a]ny place or service offering to the public accommodations, advantages, facilities, or privileges whether in the nature of goods, services, lodgings, amusements, transportation or otherwise.” The ordinance does not apply when it is necessary to comply with federal, state or local laws, when individuals need to access their own personal smart device or in social media applications. Similar to BIPA and the NYC Biometric Law, the Portland Ordinance also provides for a private right of action.
Since the surge of BIPA class action lawsuits there has been considerable pull back in insurance coverage for these types of claims.
It is important to always consult with your insurance broker to ensure you have the appropriate coverage in place and have a full understanding of what may or may not be covered when it comes to biometrics claims.
1 https://legistar.council.nyc.gov/LegislationDetail.aspx?ID=3704369&GUID=070402C0-43F0-47AE-AA6E-DEF06CDF702A&Options=&Search=
2 https://www.portland.gov/code/34/10
Willis Towers Watson hopes you found the general information provided in this publication informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, Willis Towers Watson offers insurance products through licensed subsidiaries of Willis North America Inc., including Willis Towers Watson Northeast Inc. (in the United States) and Willis Canada, Inc.
