A3625, legislation that imposes restrictions on the use of biometric information by businesses, was released from the Assembly Science, Innovation and Technology Committee after a hearing on Monday, January 25, 2021.
The Chair of the Committee and sponsor of the bill, Assemblyman Andrew Zwicker, offered some brief comments at the outset of the hearing. Assemblyman Zwicker emphasized that safeguarding biometric information is an important issue and noted his desire for the bill to balance privacy concerns with the realities of today’s marketplace. Throughout the hearing, other Committee members also expressed an interest in a measured solution to the issue.
NJCJI was among several representatives of the business community testifying against A3625. NJCJI’s President, Anthony Anastasio, testified that the bill’s private right of action and liquidated damages provisions will create a strong financial incentive for class action lawsuits against businesses for violations of the law. For instance, even purely inadvertent violations of the bill’s technical requirements that are promptly remediated could still lead to astronomical liability since Section 5 imposes a minimum $1,000 of liquidated damages per violation. Also, there is no cap on cumulative liability for a series of related violations. This liability is imposed even in the absence of actual injury or harm, and a business’ good faith is irrelevant.
Since biometric privacy is a technical topic and use of biometric identifiers in the marketplace is rapidly evolving, NJCJI argued that enforcement authority for this law should exclusively vest in New Jersey’s Attorney General. Experts with technical knowledge and sound discretion—not enterprising plaintiffs’ lawyers—should lead consistent enforcement efforts, which will protect the public and allow for investment and innovation.
Also, NJCJI argued that businesses operating in good faith should receive notice and an opportunity to cure alleged violations before enforcement is authorized. Privacy laws are complex, and even businesses with the best intentions may stumble in attempting to comply in real-world scenarios. NJCJI noted that the federal Health Insurance Portability and Accountability Act of 1996, commonly known as HIPAA, creates a cure period for this very reason and does not provide a private right of action.
The Committee voted in favor of releasing the bill on party lines. A3625 will now proceed to the Appropriations Committee for further review. NJCJI is working with the sponsors to ensure that businesses who use this technology are not subject to a flood of abusive lawsuits for harmless violations. Please email Anthony if you would like to discuss this legislation further.