Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 1 of 21
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`UNITED STATES DISTRICT COURT
`WESTERN DISTRICT OF WASHINGTON
`AT SEATTLE
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`STEVEN VANCE, et al.,
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`CASE NO. C20-1082JLR
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`v.
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`Plaintiffs,
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`MICROSOFT CORPORATION,
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`ORDER GRANTING IN PART
`AND DENYING IN PART
`REMAINDER OF MICROSOFT’S
`MOTION TO DISMISS
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`Defendant.
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`I.
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`INTRODUCTION
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`Before the court are two remaining portions of Defendant Microsoft Corporation’s
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`(“Microsoft”) motion to dismiss. (See MTD (Dkt. #25).) Plaintiffs Steven Vance and
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`Tim Janecyk (collectively, “Plaintiffs”) oppose Microsoft’s motion. (Resp. (Dkt. # 37).)
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`At the direction of the court, both parties filed supplemental briefs to address (1) the
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`interpretation of “otherwise profit from” in § 15(c) of Illinois’s Biometric Information
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`Privacy Act, 740 ILCS 14/1, et seq. (“BIPA”); and (2) whether Washington or Illinois
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`law should govern Plaintiffs’ unjust enrichment claim. (Pls. Supp. Br. (Dkt. # 45); Def.
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`ORDER - 1
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`Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 2 of 21
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`Supp. Br. (Dkt. # 44); 3/15/21 Order (Dkt. # 43) at 24.) The court has considered the
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`motion, the supplemental briefing, the relevant portions of the record, and the applicable
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`law. The court additionally held oral arguments on April 13, 2021. (See 4/13/21 Min.
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`Entry (Dkt. # 46).) Being fully advised, the court GRANTS in part and DENIES in part
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`the motion to dismiss.
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`II.
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`BACKGROUND
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`The court discussed the factual and procedural backgrounds of this case in its
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`previous order on the other portions of Microsoft’s motion to dismiss. (See 3/15/21 Order
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`at 2-5.) Thus, it only summarizes here the facts most relevant to the remaining portions
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`of the motion.1
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`Plaintiffs are Illinois residents who uploaded photos of themselves to the
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`photo-sharing website Flickr. (Compl. (Dkt. # 1) ¶¶ 6-7, 28, 60-61, 69.) Both were in
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`Illinois when uploading the photos. (Id. ¶¶ 60, 69.) Unbeknownst to them, Flickr,
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`through its parent company Yahoo!, compiled their photos along with hundreds of
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`millions of other photographs posted on the platform into a dataset (“Flickr dataset”) that
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`it made publicly available for those developing facial recognition technology. (Id.
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`¶¶ 29-32.) International Business Machines Corporation (“IBM”) created facial scans
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`from the photographs in the Flickr dataset to create a new dataset called Diversity in
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`Faces, which contained facial scans of Plaintiffs and other Illinois residents. (Id.
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`1 For the purposes of a motion to dismiss, the court accepts all well-pleaded allegations in
`Plaintiffs’ complaint as true and draws all reasonable inferences in favor of Plaintiffs. See Wyler
`Summit P’ship v. Turner Broad. Sys., Inc., 135 F.3d 658, 661 (9th Cir. 1998).
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`ORDER - 2
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`Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 3 of 21
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`¶¶ 40-41.) Microsoft obtained the Diversity in Faces dataset, including Plaintiffs’ facial
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`scans, from IBM. (Id. ¶¶ 55-56.) No company in this chain of events—Flickr, Yahoo!,
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`IBM, or Microsoft—informed or obtained permission from Plaintiffs for the use of their
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`photographs or facial scans. (Id. ¶¶ 30, 45, 65-66, 73-74.)
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`Microsoft used the Diversity in Faces dataset to improve “the fairness and
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`accuracy of its facial recognition products,” which “improve[d] the effectiveness of its
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`facial recognition technology on a diverse array of faces” and in turn made those products
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`“more valuable in the commercial marketplace.” (Id. ¶¶ 57-58.) Microsoft’s facial
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`recognition products include its Cognitive Service Face Application Program Interface
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`and its Face Artificial Intelligence service that “allowed customers to embed facial
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`recognition into their apps without having to have any machine learning expertise.” (Id.
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`¶ 53.) Microsoft additionally conducts “extensive business within Illinois” related to
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`facial recognition, including selling its facial recognition products through an
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`Illinois-based vendor; working with an Illinois-based business to build new applications
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`for facial recognition technology; and working with Illinois entities to build a “‘digital
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`transformation institute’ that accelerates the use of artificial intelligence throughout
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`society.” (Id. ¶ 59.)
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`Plaintiffs assert various claims in their class action suit against Microsoft. (See
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`generally id.) Relevant here are two of those claims: (1) violation of § 15(c) of BIPA (id.
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`¶¶ 100-06); and (2) unjust enrichment (id. ¶¶ 107-16).2 The court in its March 15, 2021,
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`2 Microsoft also challenged Plaintiffs’ other claims, and the court resolved those
`challenges in its previous order. (See 3/15/21 Order at 6-19, 23.)
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`ORDER - 3
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`Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 4 of 21
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`order found that additional briefing from the parties would be beneficial, as neither party
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`meaningfully analyzed critical legal questions behind both claims in their original
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`briefing. (3/15/21 Order at 20, 22-23.) Specifically, the court ordered the parties to file
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`supplemental briefing on (1) “the definition of ‘otherwise profit from’ in the context of
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`§ 15(c)”; and (2) “which state law should govern [Plaintiffs’ unjust enrichment claim]
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`under Washington’s ‘most significant relationship’ test.” (Id.) The parties subsequently
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`filed their supplemental briefing. (See Pls. Supp. Br.; Def. Supp. Br.)
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`III. ANALYSIS
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`When considering a motion to dismiss under Rule 12(b)(6), the court construes the
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`complaint in the light most favorable to the nonmoving party. Livid Holdings Ltd. v.
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`Salomon Smith Barney, Inc., 416 F.3d 940, 946 (9th Cir. 2005). The court must accept
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`all well-pleaded facts as true and draw all reasonable inferences in favor of the plaintiff.
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`Wyler Summit P’ship, 135 F.3d at 661. The court, however, is not required “to accept as
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`true allegations that are merely conclusory, unwarranted deductions of fact, or
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`unreasonable inferences.” Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th
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`Cir. 2001). “To survive a motion to dismiss, a complaint must contain sufficient factual
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`matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft
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`v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,
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`570 (2007)); see also Telesaurus VPC, LLC v. Power, 623 F.3d 998, 1003 (9th Cir.
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`2010). “A claim has facial plausibility when the plaintiff pleads factual content that
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`allows the court to draw the reasonable inference that the defendant is liable for the
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`misconduct alleged.” Iqbal, 556 U.S. at 677-78. Dismissal under Rule 12(b)(6) can be
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`ORDER - 4
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`Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 5 of 21
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`based on the lack of a cognizable legal theory or the absence of sufficient facts alleged
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`under a cognizable legal theory. Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699
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`(9th Cir. 1990). Utilizing this standard, the court addresses the BIPA § 15(c) and unjust
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`enrichment claims in turn.
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`A.
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`Profit Under BIPA § 15(c)
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`Section 15(c) states that “[n]o private entity in possession of a biometric identifier
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`or biometric information may sell, lease, trade, or otherwise profit from a person’s or a
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`customer’s biometric identifier or biometric information.” 740 ILCS 14/15(c). The
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`parties disagree on how broadly to read “otherwise profit from.” Microsoft argues that
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`“otherwise profit” requires “an entity receiving a pecuniary benefit in exchange for a
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`person’s biometric data.” (MTD at 22; Def. Supp. Br. at 1.) Plaintiffs propose that
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`“otherwise profit” means any use of biometric data that generates profits. (Resp. at 21;
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`Pls. Supp. Br. at 3-4.) The court finds that the proper interpretation of §15(c) falls
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`somewhere in between the two parties’ proposals.
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`The court begins, as it must, with the statutory language. See Lacey v. Village of
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`Palatine, 904 N.E.2d 18, 26 (Ill. 2009). “Profit” as a verb means “to be of service or
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`advantage” or “to derive benefit.” Profit, Merriam-Webster.com, https://www.merriam-
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`webster.com/dictionary/profit (last accessed Apr. 1, 2021); see also Profit, Oxford
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`English Dictionary, https://www.oed.com/view/Entry/152098 (last accessed Apr. 1,
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`2021) (defining “profit” as “[t]o be of advantage or benefit to”). “Otherwise” means
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`“[i]n a different manner; in another way, or in other ways.” Black’s Law Dictionary
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`1101 (6th ed. 1990). Thus, in the context of § 15(c), sale, lease or trade are examples of
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`ORDER - 5
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`what the Illinois legislature had in mind as ways to derive benefit from biometric data,
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`but the statute leaves room for other ways resembling those examples to gain an
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`advantage.
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`When a statute, like § 15(c), “specifically describes several classes of persons or
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`things and then includes ‘other persons or things,’ the word ‘other’ is interpreted to mean
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`‘other such like.’” Pooh-Bah Enters., Inc. v. Cnty. of Cook, 905 N.E.2d 781, 799 (Ill.
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`2009); Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 115 (2001) (discussing how
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`general terms that follow more specific terms “embrace only objects similar in nature to
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`those objects enumerated by the preceding specific words”). This “cardinal rule of
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`statutory construction” is known as ejusdem generis, and it is a “common drafting
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`technique” to save the legislature “from spelling out in advance every contingency in
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`which the statute could apply.”3 Pooh-Bah Enters., 905 N.E.2d at 799 (quoting 2A N.
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`Singer & J. Singer, Sutherland on Statutory Construction § 47:17, at 370-73 (7th ed.
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`2007)) (internal quotation marks omitted). Thus, the general catchall is not “given [its]
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`full and ordinary meaning” because to do so would render the specific words superfluous.
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`Id.; see also id. (“If the legislature had meant the general words to have their unrestricted
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`sense, it would not have used the specific words.”).
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`Accordingly, applied to § 15(c), “otherwise profit” should be interpreted in light of
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`the terms that precede it: sell, lease and trade. See 740 ILCS 14/15(c). All three of these
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`3 Contrary to Plaintiffs’ contention, ejusdem generis applies equally to verbs. (See Resp.
`at 22.) Courts have applied this canon to actions as well as persons or things. See, e.g., Epic Sys.
`Corp. v. Lewis, 138 S. Ct. 1612, 1625 (2018) (applying ejusdem generis canon to “form[ing],
`join[ing], or assist[ing] labor organizations”); (Reply (Dkt. # 34) at 10-11.)
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`ORDER - 6
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`terms contemplate a transaction in which an item is given or shared in exchange for
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`something of value. See Sell, Merriam-Webster.com, https://www.merriam-
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`webster.com/dictionary/sell (last accessed Mar. 31, 2021) (defining “sell” as “to give
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`up . . . to another for something of value”); Lease, Oxford English Dictionary,
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`https://www.oed.com/view/Entry/106734 (last accessed Mar. 31, 2021) (defining “lease”
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`as “[t]o grant the possession or use of (lands, etc.) by a lease”); Trade, Oxford English
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`Dictionary, https://www.oed.com/view/Entry/204275 (last accessed Mar. 31, 2021)
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`(defining “trade” as “[t]o exchange (goods, commodities, etc.) on a commercial basis; to
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`cause to change hands”). Similarly then, while “profit” may have a broader “ordinary
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`meaning,” see Pooh-Bah Enters., 905 N.E. 2d at 799, in the context of the enumerated
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`terms, “otherwise profit” encompasses commercial transactions—such as a sale, lease or
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`trade—during which the biometric data is transferred or shared in return for some benefit.
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`Thus, § 15(c) regulates transactions with two components: (1) access to biometric
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`data is shared or given to another; and (2) in return for that access, the entity receives
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`something of value. As to the first component, the biometric data itself may be the
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`product of the transaction, such as in a direct sale. Or the biometric data may be so
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`integrated into a product that consumers necessarily gain access to biometric data by
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`using the product or service. As to the second component, the court disagrees with
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`Microsoft’s contention that the biometric data must be provided “in exchange for
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`money.” (See MTD at 22.) Not all the enumerated examples involve monetary benefits.
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`For instance, one could trade for something of value that is not money. Thus, it does not
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`follow that “otherwise profit” must also be limited to a pecuniary benefit. Section 15(c)
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`ORDER - 7
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`prohibits the commercial dissemination of biometric data for some sort of gain, whether
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`pecuniary or not.
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`This reading of § 15(c) aligns with the legislative intent expressed in BIPA. See
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`740 ILCS 14/5. BIPA was designed to “regulate and promote, not inhibit,” the use of
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`biometric technology. See Vigil v. Take-Two Interactive Software, Inc., 235 F. Supp. 3d
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`499, 512 n.9 (S.D.N.Y. 2017). The legislature recognized the benefits of using
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`biometrics but understood that if biometrics are “compromised, the individual has no
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`recourse, is at heightened risk for identity theft, and is likely to withdraw from biometric
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`facilitated transactions.” 740 ILCS 14/5(a), (c). To counteract that public “wear[iness]”
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`and to encourage those who may be “deterred from partaking in biometric
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`identifier-facilitated transactions,” the legislature enacted BIPA’s additional regulations.
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`Id. 14/5(d)-(e), (g). Thus, BIPA was not intended to stop all use of biometric technology;
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`instead, it set a standard for the safe collection, use, and storage of biometrics, including
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`protecting against the public’s main fear that their biometric data would be widely
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`disseminated. Section 15(c) achieves that goal by prohibiting a market in the transfer of
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`biometric data, whether through a direct exchange—sale, lease or trade—or some other
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`transaction where the product is comprised of biometric data.
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`To that end, Plaintiffs are correct that BIPA, and § 15(c) in particular, aims to
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`“eliminate the incentive” behind marketing biometric data. (See Pls. Supp. Br. at 2-3
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`(citing Thornley v. Clearview AI, Inc., 984 F.3d 1241, 1247 (7th Cir. 2021) (analyzing
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`standing under § 15(c)).) But Plaintiffs’ argument goes astray when it assumes that BIPA
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`sought “to eliminate the incentive for private entities to collect, possess or disseminate
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`ORDER - 8
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`biometrics” in any fashion. (Id. at 2.) Not so, as BIPA’s legislative intent makes clear.
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`See 740 ILCS 14/5(a). Instead, BIPA sought to control the unauthorized collection,
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`possession or dissemination of biometric data, and § 15(c) operates to remove one main
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`incentive of sharing biometric data—to exchange it for some benefit.4
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`Indeed, Plaintiffs’ reading of § 15(c)—prohibition of any use of biometric data
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`that brings a benefit—would lead to absurd results that contravene BIPA itself. As
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`acknowledged by Plaintiffs in oral argument, § 15(c) is a flat-out prohibition. See 740
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`ILCS 14/15(c). In other words, unlike the collection, possession or dissemination of
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`biometric data, no private entity may “otherwise profit” from biometric data even if they
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`inform and obtain permission from the subject. Compare, e.g., 740 ILCS 14/15(d)
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`(allowing dissemination of biometric data with consent from subject), with 740 ILCS
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`14/15(c) (containing no exceptions). Taken to its logical end, Plaintiffs’ reading of
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`§ 15(c) would prohibit the sale of any product containing biometric technology because
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`any such feature had to be developed or built with biometric data. (See Compl. ¶¶ 15,
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`24-25 (describing how all facial recognition technology utilizes biometric data).) For
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`instance, a company could not sell biometric timekeeping systems—or any product with
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`a biometric feature—because it was presumably developed using biometric data.
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`4 Although dicta, Thornley makes clear that it interpreted § 15(c) to “prohibit[] the
`operation of a market in biometric [data],” not all technology based on biometric data. 984 F.3d
`at 1247. Analogizing to other laws such as those prohibiting the sale of migratory birds, the
`Seventh Circuit recognized that these laws aim to “eliminate the market for such material.” Id.
`In other words, the law removes an incentive behind the dissemination of these materials to
`control the spread of that material. The same holds true here. By prohibiting for-profit
`transactions involving biometric data, BIPA aims to control the spread of biometric data.
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`ORDER - 9
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`Similarly, no company could use that biometric timekeeping system because it uses
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`employees’ biometric data to streamline operations and decrease costs. Nothing—not
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`BIPA’s statutory language, its stated intent, or any authority analyzing § 15(c)—supports
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`such a broad reading.5
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`At oral argument, Plaintiffs relied on the exemptions laid out in § 25 of BIPA as a
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`limiting principle, but that section does not resolve the absurdity discussed above.
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`Section 25 provides limited scenarios that are exempt from BIPA. See 740 ILCS § 14/25.
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`For instance, the act shall not apply “to a financial institution or an affiliate of a financial
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`institution that is subject to Title V of the federal Gramm-Leach Bliley Act of 1999” or to
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`“a contractor, subcontractor, or agency of a State agency or local unit of government
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`when working for that [entity].” Id. 14/25(c), (e). But this provision does not reach the
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`scenarios discussed above, where a private entity necessarily uses biometric data—even
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`if lawfully obtained—to develop biometric technology. Nor does § 25 alter the intent
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`expressed in § 5 that BIPA did not intend to stop all use of biometric technology,
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`especially those that BIPA recognized as potentially beneficial. See 740 ILCS 14/5.
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`Adopting Plaintiffs’ reading would do just that.
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`5 Courts that have opined on the scope of § 15(c) in the context of standing have
`generally rejected such a broad reading. For instance, in Hazlitt v. Apple Inc., --- F.3d ----, 2020
`WL 6681374 (S.D. Ill. 2020), the court noted that “by its plain language,” § 15(c) does not
`prohibit “the general sales of devices equipped with facial recognition technology.” Id. at *7.
`Similarly, in Vigil, the court explained that “otherwise profiting” is best read as “a catchall for
`prohibiting commercially transferring biometric [data],” which does not reach the sale of a
`product with a biometric-related feature. 235 F. Supp. 3d at 512 n.9.
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`ORDER - 10
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`Reading § 15(c) to prohibit for-profit transactions of biometric data also comports
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`with the one court to have analyzed § 15(c)’s reach. In Flores v. Motorola Solutions,
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`Inc., No. 1:20-cv-01128, 2021 WL 232627 (N.D. Ill. Jan. 8, 2021), plaintiffs alleged that
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`the defendant used biometric data to develop a database that allowed customers to search
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`for facial matches. Id. at *3. Thus, using the product—“compar[ing] novel images to the
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`database images to find facial matches”—necessarily allowed customers to gain access to
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`the underlying biometric data. See id. In other words, without the identified biometric
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`data, there would be no product to speak of. See id. Concluding that “biometric data is a
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`necessary element to Defendant’s business model,” the court declined to say that this
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`activity does not constitute “otherwise profiting from” biometric data. Id. Flores
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`illustrates one example of how a company could “otherwise profit” from biometric data
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`without directly selling it: by creating technology that is so intertwined with the biometric
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`13
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`data that marketing the technology is essentially disseminating biometric data for profit.
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`14
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`Applied here, Plaintiffs have not alleged that Microsoft “otherwise profited” from
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`15
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`their biometric data as that term is used in § 15(c). Plaintiffs allege that Microsoft used
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`16
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`the biometric data to “improve its facial recognition products and technologies,” which
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`17
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`“improve[d] the effectiveness” of those products and made them “more valuable in the
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`commercial marketplace.” (Compl. ¶ 58.) While these allegations support the inference
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`that Microsoft may have received some benefit from increased sales of its improved
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`products, these allegations do not establish that Microsoft disseminated or shared access
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`to biometric data through its products. Plaintiffs do not allege that Microsoft directly
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`sold biometric data. (See id.) And unlike in Flores, they have not alleged that the
`
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`ORDER - 11
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`Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 12 of 21
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`biometric data is itself so incorporated into Microsoft’s product that by marketing the
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`product, it is commercially disseminating the biometric data. (See id.); see 2021 WL
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`3
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`232627, at *3. Because Plaintiffs’ factual allegations do not allow the court to reasonably
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`4
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`infer that Microsoft is sharing access to the biometric data, the court dismisses their claim
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`5
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`under § 15(c) without prejudice and with leave to amend.
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`6
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`B.
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`Unjust Enrichment
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`As the court articulated in its previous order, Microsoft challenges Plaintiffs’
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`8
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`unjust enrichment claim as insufficiently pleaded under Washington law, but Plaintiffs
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`9
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`maintain that the claim is sufficiently pleaded under Illinois law. (3/15/21 Order at
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`10
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`20-21.) The court concluded that under step one of Washington’s two-step approach to
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`11
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`choice-of-law questions, an actual conflict between Washington and Illinois law exists
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`12
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`over whether Plaintiffs must plead that they suffered an economic expense distinct from a
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`13
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`privacy harm. (Id. at 21.) Because an actual conflict exists, the court must, at step two,
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`14
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`determine which state has the “most significant relationship” to the instant claim. (Id. at
`
`15
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`22.) Washington’s “most significant relationship” test also consists of two steps. Coe v.
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`16
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`Philips Oral Healthcare Inc., No. C13-0518MJP, 2014 WL 5162912, at *3 (W.D. Wash.
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`17
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`Oct. 14, 2014). First, the court considers the states’ relevant contacts to the cause of
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`18
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`action. Johnson v. Spider Staging Corp., 555 P.2d 997, 1000-01 (Wash. 1976). Second,
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`19
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`if those contacts are evenly balanced, the court considers “the interests and public
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`20
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`policies of [the two] states and . . . the manner and extent of such policies as they relate to
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`the transaction in issue.” Id. at 1001.
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`22
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`//
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`
`
`ORDER - 12
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`Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 13 of 21
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`At the outset, the parties disagree on which contacts should guide the analysis.
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`Microsoft argues that Restatement § 221 governs restitution claims, such as Plaintiffs’
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`3
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`unjust enrichment claim. (Def. Supp. Br. at 6.) Plaintiffs urge for application of
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`4
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`Restatement § 152, which governs invasion of privacy claims, or alternatively,
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`5
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`Restatement § 145, which applies generally to torts. (Pls. Supp. Br. at 7.) The court
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`6
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`determines that § 221 is most applicable here. The commentary to § 221 plainly states
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`7
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`that it “applies to claims, which are based neither on contract nor on tort, to recover for
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`8
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`unjust enrichment.” Restatement (Second) of Law on Conflict of Laws § 221(1) cmt. a.
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`9
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`Although Plaintiffs are correct that the underlying issues involve privacy, Plaintiffs do
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`10
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`not, as in their cited authority, bring an invasion of privacy tort claim. (See Pls. Supp. Br.
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`11
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`at 8); see, e.g., Cooper v. Am. Exp. Co., 593 F.2d 612, 612 (5th Cir. 1979) (invasion of
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`12
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`privacy claim); York Grp. Inc. v. Pontone, No. 10-cv-1078, 2014 WL 896632, at *33
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`13
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`(W.D. Pa. Mar. 6, 2014) (tortious surveillance claim). Indeed, Plaintiffs provide no
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`14
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`authority applying §§ 152 or 145 to an unjust enrichment claim. (See Pls. Supp. Br.)
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`19
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`20
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`Restatement § 221 provides that:
`
`In actions for restitution, the rights and liabilities of the parties with respect
`to the particular issue are determined by the local law of the state which, with
`respect to that issue, has the most significant relationship to the occurrence
`and the parties under the principles stated in § 6.
`
`
`Restatement (Second) of Law on Conflict of Laws § 221(1). Section 6, in turn, identifies
`
`the following principles as relevant to the choice-of-law analysis:
`
`(a)
`(b)
`(c)
`
`The needs of the interstate and international systems,
`The relevant policies of the forum,
`The relevant policies of other interested states and the relative
`interests of those states in the determination of the particular issue,
`
`ORDER - 13
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`

`

`Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 14 of 21
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`
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`The protection of justified expectations,
`The basic policies underlying the particular field of law,
`Certainty, predictability and uniformity of result, and
`Ease in the determination and application of the law to be applied.
`
`(d)
`(e)
`(f)
`(g)
`
`Restatement (Second) of Law on Conflict of Laws § 6(2). In applying these principles of
`
`§ 6, the following contacts should be taken into account:
`
`(a)
`
`The place where a relationship between the parties was centered,
`provided that the receipt of enrichment was substantially related to the
`relationship,
`The place where the benefit or enrichment was received,
`The place where the act conferring the benefit or enrichment was
`done,
`The domicil, residence, nationality, place of incorporation and place
`of business of the parties, and
`The place where a physical thing, such as land or a chattel, which was
`substantially related to the enrichment, was situated at the time of the
`enrichment.
`
`Restatement (Second) of Law on Conflict of Laws § 221(2). The court’s approach is not
`
`(b)
`(c)
`
`(d)
`
`(e)
`
`merely to count contacts but rather to consider which contacts are the most significant
`
`and where those contacts are found. Johnson, 555 P.2d at 1000.
`
`
`
`Three of these contacts identified by § 221 are neutral in the unique circumstances
`
`presented by this case and thus have little bearing on the court’s choice-of-law analysis.
`
`The parties’ relationship is not centered in any one place, as Plaintiffs did not directly
`
`interact with Microsoft or its products.6 (See Compl. ¶¶ 60-63; 68-71); see Veridian
`
`Credit Union v. Eddie Bauer, LLC, 295 F. Supp. 3d 1140, 1154 (W.D. Wash. 2017)
`
`
`6 The enrichment Microsoft allegedly received was unjust specifically because of the lack
`of relationship with Plaintiffs, as the unjustness stems from the lack of consent from Plaintiffs in
`Illinois. Thus, it is unclear whether this first factor, which is identified as the contact “given the
`greatest weight,” would ever be applicable in cases such as these. See Restatement (Second) of
`Law on Conflict of Laws § 221(2) cmt. d.
`
`ORDER - 14
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`1
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`2
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`3
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`4
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`5
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`6
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`7
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`8
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`9
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`10
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`12
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`13
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`Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 15 of 21
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`(finding this factor to bear “little, if any, weight” when parties did not contract with one
`
`2
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`another). Second, there is no “physical thing, such as land or a chattel,” related to the
`
`3
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`enrichment. Restatement (Second) of Law on Conflict of Laws § 221(2)(e). Instead,
`
`4
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`Plaintiffs’ allegations revolve around the benefits obtained from intangible notions of
`
`5
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`biometric data and facial recognition technology. Thus, this factor, too, is neutral.
`
`6
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`Lastly, the place where the benefit was received is also neutral. Microsoft is based
`
`7
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`in Washington and thus would have received benefits in Washington from increased
`
`8
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`product sales. (Compl. ¶ 8; see Def. Supp. Br. at 7.) However, Plaintiffs also allege that
`
`9
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`Microsoft “conducted extensive business within Illinois related to the facial recognition
`
`10
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`products it unlawfully developed” and thus allows the reasonable inference that
`
`11
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`Microsoft received benefits in Illinois as well. (Compl. ¶ 59.) Indeed, Microsoft
`
`12
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`self-proclaims that it “work[s] with customers around the world” and “play[s] a leading
`
`13
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`role in developing facial recognition technology” and thus presumably may receive
`
`14
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`benefit in many places due to its improved facial recognition products. (See id. ¶ 54 n.15
`
`15
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`(citing Brad Smith, Facial Recognition: It’s Time for Action, Microsoft on the Issues
`
`16
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`(Dec. 6, 2018)).) Thus, although usually of greatest importance when there is no
`
`17
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`relationship between the parties, this factor also does not weigh strongly in favor of one
`
`18
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`state over another. See Restatement (Second) of Law on Conflict of Laws § 221(2)(d)
`
`19
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`(assigning this factor “little or no weight” when place where benefit was received “bears
`
`20
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`little relation to the occurrence . . . or where this place cannot be identified”).
`
`21
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`
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`The two remaining factors lean towards application of Illinois law. The place
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`22
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`where the act conferring the benefit occurred will be given “[p]articular weight” if it
`
`
`
`ORDER - 15
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`

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`Case 2:20-cv-01082-JLR Document 47 Filed 04/14/21 Page 16 of 21
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`1
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`differs from the place where the benefit was received or if the place where the benefit
`
`2
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`was received cannot be identified. Restatement (Second) of Law on Conflict of Laws
`
`3
`
`§ 221(2) cmt. d. Plaintiffs conferred the benefit in Illinois, as they and all putative class
`
`4
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`members are Illinois residents who uploaded Illinois-created content in Illinois. (Compl.
`
`5
`
`¶¶ 6-7, 60-62, 68-70, 77.) Although there are other acts in the chain of events leading to
`
`6
`
`Microsoft benefiting off of Plaintiffs’ biometric data, including actions Microsoft
`
`7
`
`allegedly took itself (see Def. Supp. Br. at 7), the core of the benefit lies in Plaintiffs
`
`8
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`providing images of their faces—albeit unknowingly—that ultimately improved
`
`9
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`Microsoft’s products. (See Compl. ¶¶ 57-59, 108-12.) Thus, this factor, which is
`
`10
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`assigned particular weight given the neutrality of the place where the benefit was
`
`11
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`received, counsels application of Illinois law. See Restatement (Second) of Law on
`
`12
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`Conflict of Laws § 221(2) cmt. d.
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`13
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`Moreover, the domicil and place of business of the parties tip towards Illinois.
`
`14
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`Although Microsoft is headquartered in Washington (id. ¶¶ 8-9), “[t]he fact that one of
`
`15
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`the parties is domiciled in a particular state is of little significance” alone, see Veridian,
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`16
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`295 F. Supp. 3d at 1154; see also Restatement (Second) of Law on Conflict of Laws
`
`17
`
`§ 221(2) cmt. d (“The fact . . . that one of the parties is domiciled . . . in a given state will
`
`18
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`usually carry little weight of itself.”). Instead, the importance of these locations “depends
`
`19
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`largely upon the extent to which they are grouped with other contacts.” Restatement
`
`20
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`(Second) of Law on Conflict of Laws § 221(2) cmt. d. Here, several contacts are grou