Another BIPA Win For Insurers
By Andrew J. Banathy
In another win for insurers, Illinois’ highest court recently denied an insured’s request for an appeal in a case involving alleged violations of the Biometrics Information Privacy Act (“BIPA”), reaffirming lower court decisions that insurers are not obligated to defend policyholders against BIPA-related claims. On March 26, 2025, the Illinois Supreme Court denied Wexford Home Corp. (“Wexford”)’s Petition for Leave to Appeal after the First District of Illinois determined that both its primary and umbrella insurers did not have a duty to defend Wexford with respect to an underlying lawsuit alleging violations of BIPA.
In Ohio Security Insurance Company et al., v. Wexford Home Corporation, Case No. 131378 (Ill. March 26, 2025), Wexford asked the Illinois Supreme Court to review its case, arguing that the 2023 decision in National Fire Ins. Co., et al. v. Visual Pak Co., Inc., 2023 IL App (1st) 221160 conflicted with the decision in W. Bend Mut. Ins. Co. v. Krishna Schaumburg Tan, Inc., 2021 IL 125978.
In Visual Pak, the First District found that the recording and distribution in violation of statutes exclusion in the subject general liability policies precluded coverage for BIPA claims. Wexford contended that Krishna, in which the court held that a violation of statutes exclusion did not exclude coverage for BIPA claims, conflicted with Visual Pak, where the court interpreted the same exclusion as barring coverage for BIPA claims, thus creating an inconsistency that warranted review by the Illinois Supreme Court.
The Illinois Supreme Court denied Wexford’s appeal without an explanation, signaling that the Illinois Supreme Court agrees with Visual Pak and its ruling on the interpretation of a recording and distribution exclusion. Furthermore, the Illinois Supreme Court’s denial of the appeal indicates that Illinois’ highest court will not be influenced by a different interpretation by the 7th Circuit of the same violation of statutes exclusion. See Thermoflex Waukegan, LLC v. Mitsui Sumitomo Ins. Co. USA, Inc., 102 F.4th 438 (7th Cir. 2024) (rejecting Visual Pak interpretation of the violation of law exclusion).
Andrew J. Banathy