SGT in the News: SGT Clients Say Insurer Must Cover $20M BIPA Settlement

As Daniel Tay of Law360 reports, SGT is representing a proposed class of Illinois residents who have filed a complaint in state court asserting that Axis Insurance Co. must cover a $20 million settlement between them and its policyholder. The plaintiffs sued the policyholder over alleged violations of the state's Biometric Information Privacy Act (BIPA).

The residents claim that Axis wrongly denied coverage because the policy's exclusion for claims arising from a "violation of statute" applies only to claims arising from statutes named in the exclusion or those similar to statutes named in the exclusion. Referring to the Illinois Supreme Court's decision in West Bend Mutual Insurance Co. v. Krishna Schaumburg Tan Inc., the residents argued that Axis' policy did not name BIPA and the statutes it did name were not similar to the BIPA provision Wynndalco Enterprises LLC allegedly violated.

The residents are suing Axis after reaching a settlement with Wynndalco under which the information technology company assigned its rights to the residents. The plaintiffs first sued Wynndalco in May 2020 as representatives of a proposed class whose biometric information was in a database compiled by facial-recognition company Clearview AI Inc. and purchased by Wynndalco. That data was eventually sold to the Chicago Police Department, according to court records.

The residents are represented by David Golub of Silver Golub & Teitell LLP, Daniel Feeney, Zachary Freeman and Rachel Simon of Miller Shakman Levine & Feldman LLP, and Kevin Forde, Brian O'Meara and Kevin Malloy of Forde & O'Meara LLP. Representatives for Axis and the residents did not respond to requests for comment.

The case is Melissa Thornley et al. v. Axis Insurance Co., No. 2021CH06168 and is pending in the Circuit Court of Cook County, Illinois.