517 F.Supp.3d 751
N.D. Ill.2021Background
- Plaintiffs (Wilcosky, Gunderson, and minor E.G.) allege Amazon’s Alexa recorded and indefinitely stored their voiceprints (biometric identifiers) without written notice or consent, violating Illinois BIPA §§ 15(a) and 15(b).
- Wilcosky alleges he never purchased or set up Alexa but claims his voice was recorded when near devices; Gunderson owns Echo devices and registered Alexa; E.G. is Gunderson’s minor child whose voice was allegedly recorded.
- Amazon’s Conditions of Use (COUs) and Alexa Terms of Use (TOUs) contain an arbitration clause and class-waiver; COUs are presented at checkout and TOUs are presented during Alexa setup (or via embedded apps).
- Defendants removed the case to federal court under CAFA and moved to compel arbitration and dismiss for lack of jurisdiction/venue; the Court considered Article III standing first.
- The Court held plaintiffs have Article III standing for both §15(b) (failure to notify/obtain consent) and §15(a) (alleged unlawful retention) claims, compelled arbitration for Wilcosky and Gunderson, and denied without prejudice the motion to compel as to minor E.G., ordering supplemental briefing on equitable estoppel/choice‑of‑law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing under BIPA §15(b) (failure to notify/consent) | Bryant controls; statutory violation itself injures informational/decisionmaking rights | No dispute on this point | Court: §15(b) violation alleges concrete, particularized injury; standing exists |
| Standing under BIPA §15(a) (retention/destruction policy) | Plaintiffs argue remand; rely on cases limiting §15(a) standing | Amazon: unlawful retention alleged here so injury is concrete | Court: following Fox, unlawful retention is a concrete injury; standing exists |
| Formation/enforceability of arbitration agreement (Wilcosky & Gunderson) | Plaintiffs: Amazon failed to show offer/assent to COUs/TOUs (esp. Wilcosky) | Amazon: purchasers manifest assent via checkout and Alexa app flows; COUs/TOUs incorporate arbitration | Court: Both agreed to COUs via purchases; Gunderson also assented to TOUs; Wilcosky may not have assented to TOUs but COUs suffice; arbitration agreement valid |
| Scope/delegation of arbitrability | Plaintiffs: dispute unrelated to contract; gateway issues for courts | Amazon: COUs incorporate AAA Rules delegating arbitrability to arbitrator | Court: Plaintiffs conceded scope; incorporation of AAA Rules delegates arbitrability to arbitrator |
| Arbitration for non‑signatory minor (E.G.) | E.G.: not bound; no agency/consent; equitable estoppel inapplicable without choice‑of‑law analysis | Amazon: equitable estoppel, inherently inseparable claims, or agency bind non‑signatory | Court: Denied/held in abeyance as to E.G.; ordered supplemental briefs on choice‑of‑law and equitable estoppel; agency/inseparability arguments fail on present record |
Key Cases Cited
- Bryant v. Compass Grp. USA, Inc., 958 F.3d 617 (7th Cir. 2020) (BIPA §15(b) procedural‑notice violation can confer Article III standing)
- Fox v. Dakkota Integrated Sys., LLC, 980 F.3d 1146 (7th Cir. 2020) (unlawful retention under §15(a) can be a concrete, particularized injury)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (Article III standing test)
- AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) (federal policy favoring enforcement of arbitration agreements)
- Janiga v. Questar Cap. Corp., 615 F.3d 735 (7th Cir. 2010) (FAA treats arbitration clauses as contract‑based and enforceable absent general defenses)
- Scheurer v. Fromm Family Foods LLC, 863 F.3d 748 (7th Cir. 2017) (elements required to compel arbitration)
- Tinder v. Pinkerton Sec., 305 F.3d 728 (7th Cir. 2002) (opponent to arbitration must identify specific evidence creating a triable factual dispute)
- Sgouros v. TransUnion Corp., 817 F.3d 1029 (7th Cir. 2016) (online assent assessed by whether reasonable user would realize they were assenting)
- Commonwealth Edison Co. v. Gulf Oil Corp., 541 F.2d 1263 (7th Cir. 1976) (incorporation of arbitration rules by reference integrates those rules into the agreement)