Every once and a while, I get glimmers of hope on the prospect of legal reform in California. The passage of AB 1219 by Assemblyman Henry Perea (D – Fresno) is one of those times.
Back in February of 2011, the California State Supreme Court unanimously ruled in Pineda vs. Williams Sonoma that zip codes are part of customers' addresses and considered "personal identification information" under the California Song-Beverly Credit Card Act of 1971. The state consumer privacy law forbids stores from requesting addresses and other personally identifying information during credit card transactions. The law imposes a civil penalty of up to $250 for the first violation and up to $1,000 for each subsequent violation.
Well, the minute that decision came down our dear friends the trial lawyers opened the floodgates of litigation on retailers. Hundreds of class action lawsuits were filed against businesses in California within weeks of the decision. In an attempt to stop this abuse, Assemblyman Perea introduced AB 1219.
Initially, AB 1219 was going to go a lot further than it did, but in the end this legislation focused on gas stations. Almost every time you go to a gas station and use your credit or debit card, you are prompted to enter your zip code. While this is intended as a measure to help prevent identity theft, it became illegal after the court decision.
In order to prevent potential disruption of gasoline station services throughout the state, it was necessary to create a new exception to the prohibition on the collection of zip code information when using credit cards during a gasoline purchase. AB 1219 did just that and it is due to the leadership of Assemblyman Perea that a disaster was averted for the gasoline industry in this state.
CALA applauds Assemblyman Perea and Governor Brown for supporting this legal reform measure and stopping the zip code lawsuit madness. It is just too bad that a reform measure could not have been crafted to save the hundreds of retailers in other industries who were sued. But no one ever said the legal reform fight in California would be easy. This is a common sense bill and we are glad it is now law!