March 24 (Westlaw Journals) - Just days after the California Supreme Court ruled that retailers cannot ask for customers’ ZIP codes during credit card transactions, more than a dozen people filed state court class-action lawsuits alleging unfair business practices by numerous merchants. 

By asking for customer ZIP codes, the state high court held, retailers are violating the state’s Song-Beverly Credit Card Act of 1971, Cal. Civ. Code § 1747, which prohibits merchants from requesting and recording “personal identification information.”  Pineda v. Williams-Sonoma Stores, 246 P.3d 612 (Cal. Feb. 10, 2011). 

The high court reversed rulings by both the San Diego County Superior Court and a state appeals court. 

California resident Jessica Pineda said a cashier at home-goods retailer Williams-Sonoma asked for her ZIP code and entered it into the cash register.  

Pineda, expressing concerns that the information could lead to credit card fraud or identity theft, filed suit in the Superior Court in June 2008 on behalf of a statewide class of consumers who had been asked for their ZIP codes during credit card transactions. 

Williams-Sonoma used the information to obtain customer addresses for use in marketing, the suit said. 

Judge Ronald Prager ruled that a ZIP code is not considered personally identifying information, and the state’s 4th District Court of Appeal affirmed.  Unlike an address or phone number, the appeals court said, a ZIP code applies to many people in an area, rather than just an individual. 

The Supreme Court rejected this reasoning.   

Writing the opinion, Justice Carlos R. Moreno said an address and a phone number also can apply to a group if multiple people live in the same residence.  Further, a ZIP code is not necessary to complete a retail transaction, is part of an address and can be used to obtain a full address, he added. 

The high court stressed that a store can request to see a customer’s identification, such as a drivers’ license, but cannot record that information. 

Since the Supreme Court’s ruling, at least a dozen similar suits have been filed against retailers in the state, alleging unfair business practices and violation of Song-Beverly. 

In one case, Los Angeles resident Maria Valiente sued retail chain Bed Bath & Beyond on behalf of state consumers who had personally identifying information recorded during credit card transactions in the past four years. 

The suits seek damages and injunctive relief directing merchants to stop asking for and recording customers’ personally identifying information.  Song-Beverly provides for a $250 fine for the first offense, and each subsequent violation carries a $1,000 fine. 

The plaintiff’s attorneys are Christopher P. Ridout, Ridout & Lyon, Long Beach, Calif.; and Hart L. Robinovitch, Zimmerman Reed PLLP, Minneapolis. 

Valiente v. Bed Bath & Beyond Inc. et al., No. BC455048, complaint filed (Cal. Super. Ct., L.A. County Feb. 14, 2011).