`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
`
`
`In re: Clearview AI, Inc. Consumer Privacy
`Litigation
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`Civil Action File No.: 1:21-cv-00135
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`Judge Sharon Johnson Coleman
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`Magistrate Judge Maria Valdez
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`PLAINTIFFS’ REPLY IN SUPPORT
`OF MOTION FOR PRELIMINARY INJUNCTION
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 2 of 26 PageID #:830
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`TABLE OF AUTHORITIES .......................................................................................................... ii
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`TABLE OF CONTENTS
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`INTRODUCTION ...........................................................................................................................1
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`SUPPLEMENTAL FACTS .............................................................................................................1
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`ARGUMENT ...................................................................................................................................7
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`I. Evidentiary Standards ...........................................................................................................7
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`II. Plaintiffs Are Reasonably Likely to Succeed on the Merits .................................................8
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`A. Defendants Are Not Exempt from BIPA ....................................................................8
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`B. Plaintiffs Do Not Seek the Extraterritorial Application of BIPA ..............................10
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`C. The Dormant Commerce Clause Does Not Apply to This Case ...............................11
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`D. The First Amendment Does Not Bar Plaintiffs’ BIPA Claims .................................12
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`1.
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`Legal Standards ..........................................................................................12
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`2. BIPA Regulates Conduct ...........................................................................13
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`3. Even if BIPA Burdens Speech, It Is Subject to Intermediate
` Scrutiny ......................................................................................................15
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`4. BIPA Satisfies Intermediate Scrutiny ........................................................17
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`III. Absent Injunctive Relief, Plaintiffs Will Suffer Irreparable Harm .....................................18
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`IV. Plaintiffs and Class Members Have No Adequate Remedy at Law ...................................20
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`CONCLUSION ..............................................................................................................................20
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`CERTIFICATE OF SERVICE ......................................................................................................22
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`i
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 3 of 26 PageID #:831
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`TABLE OF AUTHORITIES
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`CASES
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`ACLU of Ill. v. Alvarez, 679 F.3d 583 (7th Cir. 2012)...................................................................14
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`Adams v. Catrambone, 359 F.3d 858 (7th Cir. 2004) ......................................................................9
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`Avery v. State Farm Mut. Auto. Ins. Co., 835 N.E.2d 801 (Ill. 2005) .....................................10, 11
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`Bartnicki v. Vopper, 532 U.S. 514 (2001) .....................................................................................17
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`Bryant v. Compass Group USA, Inc., 958 F.3d 617 (7th Cir. 2020) .......................................10, 19
`
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`Carpenter v. U.S., 138 S.Ct. 2206 (2018) ......................................................................................20
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`Dahlstrom v. Sun-Times Media, LLC, 777 F.3d 937 (7th Cir. 2015) .................................... passim
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`Federal Trade Comm’n v. Lifewatch, Inc., 176 F.Supp.3d 757 (N.D. Ill. 2016) ............................7
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`Healy v. Beer Inst., Inc., 491 U.S. 324 (1989) ...............................................................................11
`
`In Re Facebook Biometric Info. Privacy Litig.,
`No. 3:15-cv-03747-JD, 2018 WL 2197546 (N.D. Cal., May 14, 2018) ........................................11
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`Kyllo v. United States, 533 U.S. 27 (2001) ....................................................................................17
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`Lockwood v. American Airlines, Inc., 107 F.3d 1565 (Fed. Cir. 1997) ...........................................9
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`Midwest Title Loans, Inc. v. Mills, 593 F.3d 660 (7th Cir. 2010) ..................................................11
`
`Monroy v. Shutterfly, Inc.,
`No. 16 C 10984, 2017 WL 4099846 (N.D. Ill. Sept. 15, 2017) .........................................10, 11, 17
`
`
`Patel v. Facebook, Inc., 932 F.3d 1264 (9th Cir. 2019) ..........................................................10, 11
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`Reed v. Town of Gilbert, Ariz., 576 U.S. 155 (2015) .....................................................................16
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`Rivera v. Google, Inc., 238 F.Supp.3d 1088 (N.D. Ill. 2017) ..................................................10, 11
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`Rosenbach v. Six Flags Entertainment Corporation, 2019 IL 123186 (Ill. 2019) ..................17, 19
`
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`Rumsfeld v. Forum for Academic. & Inst’l Rts., Inc., 547 U.S. 47 (2006) ..............................12, 15
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`S. Dakota v. Wayfair, Inc., 138 S. Ct. 2080 (2018) .......................................................................12
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`ii
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 4 of 26 PageID #:832
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`Sorrell v. IMS Health Inc., 564 U.S. 552 (2011) ...............................................................13, 15, 16
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`State of Ill. v. Austin, 155 N.E.3d 439 (Ill. 2019) ...................................................................16, 18
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`TD Bank N.A. v. Hill, 928 F.3d 259 (3d Cir. 2019) .......................................................................20
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`Turner Broad. Sys., Inc. v. F.C.C., 512 U.S. 622 (1994) ...............................................................18
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`U.S. v. O'Brien, 391 U.S. 367 (1968) ......................................................................................13, 17
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`12 C.F.R. § 1016 ............................................................................................................................16
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`STATUTES
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`15 U.S.C. § 1681 ............................................................................................................................14
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`20 U.S.C. § 1232g ....................................................................................................................15, 16
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`410 ILCS 513/1 ..............................................................................................................................15
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`5 ILCS 179/10 ................................................................................................................................15
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`5 ILCS 70/1.28 .................................................................................................................................9
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`740 ILCS 14/10 ..........................................................................................................................5, 17
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`740 ILCS 14/20 ..............................................................................................................................12
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`740 ILCS 14/25 ................................................................................................................................8
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`740 ILCS 14/5 ......................................................................................................................9, 13, 19
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`Pub. L. No. 104-191 .......................................................................................................................14
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`OTHER AUTHORITIES
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`Illinois Constitution, Article VII, sec. 1 (1970) ...............................................................................9
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`Kashmir Hill, Before Clearview Became a Police Tool, It Was a Plaything of the Rich, New
`York Times (Mar. 5, 2020), https://www.nytimes.com/2020/03/05/technology/clearview-
`investors.html (last accessed on May 6, 2021) ............................................................................ 8-9
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`Zach Whittaker, Security Lapse Exposed Clearview AI Source Code, TechCrunch (Apr. 16,
`2020), https://techcrunch.com/2020/04/16/clearview-source-code-lapse/
`(last accessed on May 6, 2021) ......................................................................................................18
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`iii
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 5 of 26 PageID #:833
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`INTRODUCTION
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`Since Plaintiffs filed their preliminary injunction motion, the need for the requested relief
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`has heightened. Based on the Court-ordered deposition of Clearview’s1 General Counsel, Thomas
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`Mulcaire, Plaintiffs have learned that: (a) Defendants have set up two offshore companies that can
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`be used to offer the Biometric Database in the U.S.; (b)
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`. Compounding matters, Mulcaire’s deposition made clear that
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`Clearview’s General Counsel is an incredible witness, willing to say whatever is convenient.
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`The fact is that Defendants developed an illegal business model that violates the privacy
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`rights of millions of Illinois residents and now want to be rewarded for their illegal actions by
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`avoiding the requested injunctive relief. However, the facts and law make clear that Plaintiffs are
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`entitled to the requested relief. In the absence of such relief, Defendants will continue to collect
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`and disseminate Plaintiffs’ and Class Members’ Biometric Data without implementing necessary
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`safeguards; worse, they could move that data offshore where it will be much more difficult: (a) to
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`determine what, if any, safeguards are in place; and (b) for Plaintiffs to enforce their rights.
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`SUPPLEMENTAL FACTS
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`Defendants premise their response on Mulcaire’s declaration. See Dkt. 43. However,
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`Mulcaire’s deposition revealed that Mulcaire is an incredible witness whose declaration contains
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`numerous false or materially inaccurate statements and omits critical facts. Indeed, Mulcaire has
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`1 Capitalized and defined terms have the same meanings as set forth in Plaintiffs’ Motion for Preliminary
`Injunction.
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`1
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 6 of 26 PageID #:834
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`lied under oath about something as simple as when he became General Counsel – in addition to
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`misrepresenting material facts to the Illinois Secretary of State.
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`Mulcaire Is Not a Credible Witness
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`In three sworn declarations, Mulcaire represented to the Court that he has been Clearview’s
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`General Counsel since September 2019. Mutnick Dkt. 56-2, ¶ 1; Mutnick Dkt. 65-1, ¶ 1; Dkt. 43-
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`1, ¶ 1. But Mulcaire did not become a licensed attorney until March 2020. Exhibit 1 (Mulcaire Tr.)
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`at 14:12-17. Thus, Mulcaire could not have been the General Counsel in September 2019 unless
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`he was practicing law without a license. Assuming that he did not do that, Mulcaire repeatedly
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`misrepresented facts to the Court and/or failed to carefully review his declarations for accuracy.
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`Mulcaire has a history of mispresenting material information. Plaintiff Mutnick previously
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`informed the Court of Mulcaire’s material misrepresentations to the Illinois Secretary of State
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`regarding the claim that a Clearview subsidiary – Rocky Mountain Data Analytics, LLC (“Rocky
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`Mountain”) – was the sole manufacturer and provider of the Biometric Database. Mutnick Dkt. 64,
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`64-7. Even though the representations were demonstrably false, at his deposition, Mulcaire falsely
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`testified that they were “100 percent true.” Ex. 1 at 164:2-14.
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`At issue is a “Sole Manufacturer Statement” signed by Mulcaire that represented to the
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`Secretary of State that: (a) Rocky Mountain “is the sole manufacturer and provider of the
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`[Biometric Database]”; and (b) to the “best of our knowledge, there is no other company that offers
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`this product and set of capabilities.” Exhibit 2 (Sole Manufacturer Statement). The Sole
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`Manufacturer Statement allowed Rocky Mountain to provide the Biometric Database to the
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`Secretary of State without a competitive bidding process. Ex. 1 at 160:23-161:8, 162:13-17.
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`Knowing that Clearview also was a provider of the Biometric Database, at his deposition, Mulcaire
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`2
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 7 of 26 PageID #:835
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`incredibly insisted the statement also referred to Clearview, even though it never mentioned
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`Clearview. See Ex. 1 at 156:22-157:10, 158:16-23, 159:9-12, 160:1-164:14.
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`Defendants Have Set Up Offshore Companies
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`At his deposition, Mulcaire testified that Defendants have set up offshore subsidiaries in
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`Panama and Singapore to offer Clearview’s software. Id. at 174:21-175:12, 175:20-176:20.
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`Mulcaire admitted that Clearview, itself, currently can offer its Biometric Database to foreign
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`countries, and when asked why Defendants needed the offshore companies, he asserted the
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`attorney-client privilege. Id. at 177:1-4, 178:7-179:1. Mulcaire further admitted that the offshore
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`companies could offer the Biometric Database in the United States. Id. at 179:25-180:25.
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`Clearview Is Incapable of Responsibly Handling the Biometrics
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`At his deposition,
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`. Id. at 105:20-
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`106:15; 152:23-153:13 290:4-11. According to Mulcaire,
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`testimony is truthful,
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`.
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` Id. at 290:9-12. To the extent the
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`Defendants’ Security Measures Are Illusory
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`Mulcaire’s declaration states that Clearview has only had two “known” hacks and sets forth
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`what he deems to be “reasonable safeguards” Defendants have implemented to secure Clearview’s
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`data. Dkt. 43-1, ¶¶ 26, 28. Mulcaire admits that he is not a cybersecurity, encryption or technology
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`expert and that he does not read treatises regarding cybersecurity. Ex. 1 at 84:19-23, 277:23-278:4.
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`Further, Mulcaire does not know if Defendants use the most up-to-date encryption to protect the
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`3
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 8 of 26 PageID #:836
`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 8 of 26 PageID #:836
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`Biometlic Database or whether the level of encryption used is standard in the facial recognition
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`industly. Id. at 85:18-22, 8613-5.
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`— At his deposition,-
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`—. Ex. 1 at 27112-7. When asked at his deposition which ofthe new “reasonable
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`safeguards” would now alert Cleaiview to an actual or attempted hack similar to the one that
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`provided access to Clearview’s app, Mulcaire testified that the question went “beyond the scope
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`of what was in my declaration and what I know about.” Id. at 278:24—280: 1.
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`It Is Not “Impossiblefor Clearview to Determine Where the Subjects ofImages Reside”
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`Contraiy to Mulcaire’s deposition, it is not “impossible for Cleaiview to determine where
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`the subjects of the images [it collects from the Internet] reside” (Dkt. 43-1, 1[ 9), and, thus, requiring
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`Clearview to remove all images of Illinois residents from the Biometric Database would not
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`“effectively shut down Clealview’s operations nationwide.“ Id. 1l 1]. At his deposition,-
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`196:25, 204:25-20527, 210:14-212:23. However, Mulcaire admitted that no one at C learview had
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`attempted to manually determine where the subjects of images resided, a method discussed at the
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`deposition. Id. at 206: 17—18, 207218—25.
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`I»)
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`. EX. 1 at 274:21-275:15.
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 9 of 26 PageID #:837
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`The Clearview Defendants Sell, Lease, Trade, Disseminate, Disclose and Provide Access to
`Biometric Information
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`Mulcaire’s declaration carefully states that Clearview does not “sell, lease, trade,
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`disseminate, disclose, or provide access to any facial vectors to its customers.”3 Dkt. 43-1, ¶ 15
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`(emphasis added). However, in a previous declaration and at his deposition, Mulcaire admitted
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`that “anyone with internet capability is able to access the files that Clearview downloads in its
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`database” (Dkt. 56-2 (Mulcaire Decl.), ¶ 4; Ex. 1 at 188:2-5), calling the above-described statement
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`into doubt.
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`At his deposition, Mulcaire was asked about an earlier declaration that stated that
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`Clearview did not “sell, lease, trade, or disseminate any biometric information to its customers.”
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`Ex. 1 at 223:4-225:13 (emphasis added). Mulcaire stated that he switched from “biometric
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`information” to “facial vectors” because “it’s more clear as to – and a better reflection of the actual
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`state of affairs . . . . by changing it to facial vectors, it makes it clear what we’re talking about in
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`the context of Clearview’s operations.”4 Id. at 225:5-13.
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`Even if Mulcaire had not clarified in his declaration that Clearview does not sell or
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`distribute biometric identifiers, his deposition testimony made clear that his previous reference to
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`“biometric information” had not nothing to do with BIPA. According to Mulcaire, by stating that
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`Clearview did not sell or distribute “biometric information,” he meant that the photographs and
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`website URLs collected by Clearview were not biometric information. Id. at 219:3-223:3, 226:24-
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`228:3. Importantly, Mulcaire’s testimony made clear that Clearview provides customers with
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`3 Under BIPA, a “biometric identifier” is a “retina or iris scan, fingerprint, voiceprint, or scan of hand or
`face geometry” – i.e., a set of measurements unique to a person by which the person can be identified.740
`ILCS 14/10. In contrast, “biometric information” is “any information, regardless of how it is captured,
`converted, stored, or shared, based on an individual’s biometric identifier used to identify an individual.”
`Id. (emphasis added).
`4 A facial vector is a “mathematical representation of a face as it appears in a photograph” – i.e., a biometric
`identifier. Id. at 129:8-18; see also id. at 136:7-13 (discussing Clearview’s “facial geometry algorithm”).
`5
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 10 of 26 PageID #:838
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`biometric information – i.e., Clearview’s software identifies unknown individuals based on their
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`“facial vectors” or biometric identifiers. Id. at 181:19-184:12.
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`Mulcaire Misrepresented the Nature of Who Can Access the Biometric Database
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`Contrary to Mulcaire’s declaration (Dkt. 43-1, ¶ 17), Defendants’ documents show that
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` at 10, 19, 23-25, 40; Ex. 1 at 242:1-251:11; Exhibit 5 (Clearview Code
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`. See Exhibit 4
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`of Conduct) at 14.
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`During his deposition, Mulcaire also testified that Defendants
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`Id. at 233:5-236:8. Mulcaire further acknowledged that various Clearview employees
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`have conducted thousands of individual searches of the Biometric Database. Id. at 251:12-265:2;
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`Ex. 2 at 8, 15, 20-21, 31-32, 42-43, 48.
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`acknowledged that, in the past, Clearview investors were granted access to the Clearview app. Id.
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`. Ex. 1 at 251:19-21, 252:10-22, 264:22-24. Finally, Mulcaire
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`6
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 11 of 26 PageID #:839
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`at 86:20-22. While Mulcaire claimed that Clearview currently has a policy against investors being
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`granted such access, he admitted that the policy is not in writing and that it is really just a “decision
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`that’s been made by the corporate leadership.” Id. at 105:20-106:15. Moreover, Mulcaire
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`acknowledged that the decision could be changed. See id. at 103:20-105:3.
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`Clearview’s Post-Injunction-Motion Business Changes Are Illusory.
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`The business changes Defendants purportedly made after Plaintiff Mutnick filed his
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`preliminary injunction motion (see Dkt. 43-1, ¶¶ 33-45) are illusory. For instance, Mulcaire agreed
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`that if photographs on the Internet do not have embedded geolocation data, Clearview cannot
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`automatically determine if they were taken in Illinois and cannot “block them.” Ex. 1 at 285:1-16.
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`.
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` Mulcaire confirmed the
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`purported changes can be reversed at any time. Id. at 292:19-293:8.
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`ARGUMENT
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`Evidentiary Standards.
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`A preliminary injunction seeks to preserve the parties’ relative positions prior to a trial on
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`I.
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`
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`the merits. Federal Trade Comm’n v. Lifewatch, Inc., 176 F.Supp.3d 757, 761 (N.D. Ill. 2016). A
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`court may grant a preliminary injunction using less formal procedures and less complete evidence
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`than at trial. Id. It is settled law that “relaxed evidentiary standards permit a district court to
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`consider hearsay at the preliminary injunction stage.” Id. at 763. The applicable standard is whether
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`the evidence is appropriate given the nature of an injunctive proceeding, e.g., the need for an
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`7
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 12 of 26 PageID #:840
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`expeditious resolution. Contrary to Defendants’ contention (Dkt. 43 at 6), based on the applicable
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`standards, Plaintiffs’ evidence is appropriate and demonstrates the need for the requested relief.
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`II.
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`Plaintiffs Are Reasonably Likely to Succeed on the Merits.
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`A.
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`Defendants Are Not Exempt from BIPA.
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`BIPA § 25(e) provides: “Nothing in this Act shall be construed to apply to a contractor,
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`subcontractor, or agent of a State agency or local unit of government when working for that State
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`agency or local unit of government.” 740 ILCS 14/25(e) (emphasis added). Defendants argue that
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`Clearview’s operations wholly fall under this exemption. Dkt. 43 at 13. The argument lacks merit.
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`(a)
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`(d)
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`As discussed above and in Plaintiffs’ opening brief, Clearview’s own documents show that:
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`; (c)
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`; (b)
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`;
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` and (e) Clearview
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`has applied for a patent that goes far beyond a product offered to government bodies. Further,
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`. On these facts, § 25(e) does not wholly exempt Clearview from BIPA’s
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`requirements. See also Dkt. 43 at 15 (Defendants work with agents of law enforcement and/or
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`governments).
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`The § 25(e) exemption does not apply for the separate reason that Defendants did not
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`collect Plaintiffs’ and Class Members’ Biometric Data “when working for” a State agency or local
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`unit of government. Rather, Defendants first built the Biometric Database and then figured out
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`what to do with it. See Kashmir Hill, Before Clearview Became a Police Tool, It Was a Plaything
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`of
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`the
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`Rich,
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`New
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`York
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`Times
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`(Mar.
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`5,
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`2020),
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`8
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 13 of 26 PageID #:841
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`https://www.nytimes.com/2020/03/05/technology/clearview-investors.html (last accessed on May
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`6, 2021) (Defendants developed the facial recognition service not knowing who would pay for it).
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`Even if Defendants only did business with “governments and governmental entities,” §
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`25(e)’s exemption still would not apply because BIPA’s text makes clear that the exemption only
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`includes conduct undertaken when working for Illinois agencies or local units of government in
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`Illinois. 740 ILCS 14/5(b) (referring to the City of Chicago and “other locations in this State”); see
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`also 5 ILCS 70/1.28 and Ill. Const. Art VII, sec. 1 (1970) (defining “units of local government”;
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`do not include police departments). The record is clear that Defendants offer the Biometric
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`Database to numerous governmental entities outside of Illinois. See Dkt. 43-3 at 2.
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`
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`Even if the Court were to find the definitions of “State” and “local unit of government” to
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`be ambiguous, extrinsic interpretive aids – which the court may consult in such circumstances,
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`Adams v. Catrambone, 359 F.3d 858, 862 (7th Cir. 2004) – confirm Plaintiffs’ reading. See Exhibit
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`6 (State of Illinois – Bill Drafting Manual (2007)) at 277 (capitalize “State” when referring to the
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`“State of Illinois”).
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`Defendants misstate the holding of the case they cite to justify their patent application’s
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`explicit reference to non-governmental uses. See Dkt. 43 at 11-12 and n.2. The cited case merely
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`provides that to claim an invention dating back to a previous application, a newer application must
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`contain an equivalent description. See Lockwood v. American Airlines, Inc., 107 F.3d 1565, 1572
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`(Fed. Cir. 1997). Thus, to preserve their invention of technology that assists law enforcement in
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`identifying suspects or victims, Defendants’ recent patent application only needed to describe that
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`aspect of the invention. See id.
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`9
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 14 of 26 PageID #:842
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`
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`B.
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`Plaintiffs Do Not Seek the Extraterritorial Application of BIPA.
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`Contrary to Defendants’ contention (Dkt. 43 at 15), Plaintiffs do not seek the extraterritorial
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`application of BIPA. Every court that has considered the contention in a similar context has
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`rejected it. See, e.g., Patel v. Facebook, Inc., 932 F.3d 1264, 1275-76 (9th Cir. 2019); Rivera v.
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`Google, Inc., 238 F.Supp.3d 1088, 1100-02 (N.D. Ill. 2017); Monroy v. Shutterfly, Inc., No. 16 C
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`10984, 2017 WL 4099846, at *5-7 (N.D. Ill. Sept. 15, 2017).
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`Further, determining the applicability of the extraterritoriality doctrine requires a fact-
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`intensive inquiry, and the facts here do not support Defendants’ argument. See Avery v. State Farm
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`Mut. Auto. Ins. Co., 835 N.E.2d 801, 854 (Ill. 2005), (“[E]ach case must be decided on its own
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`facts.”). In Avery, the Illinois Supreme Court held that the plaintiffs sought the extraterritorial
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`application of an Illinois consumer fraud statute because the relevant circumstances at issue did
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`not occur “primarily and substantially” within Illinois but rather in the state where, among other
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`things: (a) plaintiffs resided; (b) the deception or “failure to disclose” occurred; and (c) the
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`plaintiffs incurred their injury. Id. at 854.
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`Unlike in Avery, here, the relevant circumstances occurred in Illinois. Defendants failed to
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`obtain Plaintiffs’ and Class Members’ consent in Illinois to use their Biometric Data. Had
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`Defendants made any of the required disclosures, those disclosures would have occurred in Illinois
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`where Plaintiffs and Class Members reside. See id. at 854 (look to where information is received).
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`Moreover, Defendants injured Plaintiffs and Class Members in Illinois by trespassing on their
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`private domains. See Bryant v. Compass Group USA, Inc., 958 F.3d 617, 624 (7th Cir. 2020)
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`(equating BIPA violation to a trespass of a person’s private domain).5
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`
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`5
`. Further, Mulcaire
`testified that Clearview also has an employee who lives in Illinois. Ex. 1 at 293:20-294:2.
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`10
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`
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 15 of 26 PageID #:843
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`Ignoring the facts and the law, Defendants contend the “‘majority of circumstances’ giving
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`rise to Plaintiffs’ claims occurred outside of Illinois.” Dkt. 43 at 15. However, courts have rejected
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`the factors relied on by Defendants as being dispositive for purposes of the extraterritoriality
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`analysis. See Avery, 835 N.E.2d at 854-55 (rejecting defendant’s home state as state with most
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`nexus to claim); Patel, 932 F.2d at 1276 (server location is not dispositive).
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`
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`C.
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`The Dormant Commerce Clause Does Not Apply to This Case.
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`Defendants’ dormant Commerce Clause contention (see Dkt. 43 at 15-16) suffers the same
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`flaws as their extraterritoriality argument. Courts routinely reject dormant Commerce Clause
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`challenges when out-of-state defendants obtain Illinois residents’ Biometric Data. See In Re
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`Facebook Biometric Info. Privacy Litig., No. 3:15-cv-03747-JD, 2018 WL 2197546, at *4 (N.D.
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`Cal., May 14, 2018); Rivera, 238 F.Supp.3d at 1102-04; Monroy, 2017 WL 4099846, at *7-8.
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`Further, unlike here, the dormant Commerce Clause only “precludes the application of a state
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`statute to commerce that takes place wholly outside of the State’s borders, whether or not the
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`commerce has effects within the state.” Rivera, 238 F.Supp.3d at 1103 (quoting Healy v. Beer
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`Inst., Inc., 491 U.S. 324, 336 (1989)) (internal quotation marks omitted) (emphasis added). The
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`conduct here did not take place “wholly” outside Illinois.
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`
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`Defendants’ reliance on Midwest Title Loans, Inc. v. Mills, 593 F.3d 660 (7th Cir. 2010)
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`(Dkt. 43 at 15), is misplaced. Unlike BIPA – which protects Illinois residents in Illinois, in Mills,
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`an Indiana statute imposed an Indiana licensing requirement for lenders executing transactions
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`entirely within Illinois. Id. at 662. Further, contrary to Defendants’ contention (Dkt. 43 at 16),
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`BIPA does not “exalt[] the public policy of one state over that of another.” See Mills, 593 F.3d at
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`Under BIPA, other states can permit private entities to collect, use and distribute their own
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`residents’ Biometric Data. Likewise, Illinois may protect its own citizens from privacy violations
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`
`
`11
`
`
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 16 of 26 PageID #:844
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`perpetrated online, even by actors physically located elsewhere. Cf. S. Dakota v. Wayfair, Inc., 138
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`S. Ct. 2080, 2097 (2018) (the Commerce Clause does not “limit[] the lawful prerogatives of the
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`States” by requiring that regulated online entities have a physical presence in the State).
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`
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`Defendants’ reliance on unsuccessful New York legislation (Dkt. 43 at 16) is similarly
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`misplaced. That New York failed to pass a bill protecting New York citizens’ biometric
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`information cannot preclude Illinois from protecting the biometric data of its own citizens.
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`
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`Finally, the facts belie Defendants’ claim that they have no way to identify Illinois residents
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`and, if required to do so, Clearview likely would go out of business. See Dkt. 43 at 16. Defendants
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`simply do not want to make the effort to identify Illinois residents, calling the process
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`“impracticable.” Ex. 1 at 205:2-7. Further, BIPA is not a strict liability statute; it only imposes
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`liability for negligent, reckless, or intentional violations. 740 ILCS 14/20. Thus, Defendants are
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`required only to make reasonable efforts to identify Illinois residents. That they do not want to
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`make such efforts does not create a dormant Commerce Clause issue.
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`D.
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`The First Amendment Does Not Bar Plaintiffs’ BIPA Claims.
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`
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`BIPA, as applied to Defendants, does not violate the First Amendment because the
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`provisions at issue regulate conduct, not speech. To the extent any provision limits information
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`Defendants can communicate to others, it does so in a content-neutral manner and is therefore
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`subject to intermediate scrutiny, which it easily survives.
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`1.
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`Legal Standards.
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`Laws that regulate conduct do not implicate the First Amendment merely because a party
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`
`
`
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`wishes to use the regulated conduct in service of some future speech. See Rumsfeld v. Forum for
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`Academic. & Inst’l Rts., Inc., 547 U.S. 47, 66 (2006) (rejecting notion that “a regulated party could
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`always transform conduct into ‘speech’ simply by talking about it”). Rather, a First Amendment
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`
`
`12
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`
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`Case: 1:21-cv-00135 Document #: 68 Filed: 05/17/21 Page 17 of 26 PageID #:845
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`injury only arises if the regulated conduct is “so inherently expressive” that it warrants
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`constitutional protection. Id. at 47. Even then, the challenged regulation is subject to intermediate
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`scrutiny and is constitutional if “it furthers an important or substantial governmental interest; if
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`[that] interest is unrelated to the suppression of free expression; and if the incidental restriction on
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`alleged First Amendment freedoms is no greater than is essential to the furtherance of that interest.”
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`U.S. v. O'Brien, 391 U.S. 367, 377 (1968) (“O’Brien Test”).
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`If a challenged law directly regulates speech, a court must consider whether it does so in a
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`content-neutral or content-based manner. Dahlstrom v. Sun-Times Media, LLC, 777 F.3d 937, 950
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`(7th Cir. 2015). Content-neutral speech regulations are subject to intermediate scrutiny. Id. at 949,
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`952 (applying the O’Brien Test). While content-based speech regulations generally are subject to
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`strict scrutiny, id. at 949, when the regulated speech is commercial in nature, a form of intermediate
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`scrutiny applies. See Sorrell v. IMS Health Inc., 564 U.S. 552, 571-72 (2011) (content-based statute
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`failed under more permissive “commercial speech inquiry” and the “stricter form of judicial
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`scrutiny” applicable to regulations of non-commercial speech).
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`2.
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`BIPA Regulates Conduct.
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`Defendants claim that BIPA regulates their speech because it inhibits their “ability to
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`collect, analyze, and include public information in [their] product, and prevent[s] dissemination of
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`truthful information regarding the identity of individuals pictured in law enforcement-submitted
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`images.” Dkt. 43 at 17. This contention fails as a matter of fact and law. As set f