California’s Song-Beverly Credit Card Act, Civil Code section 1747.08, prohibits retailers from requesting or requiring “personal identification information” (PII) in connection with consumer credit card transactions and then recording that information.  Following a February 2011 California Supreme Court opinion in Pineda v. Williams-Sonoma Stores, Inc., plaintiffs filed hundreds of putative class action complaints against retailers throughout California alleging violations of the Act.  But, the extent of the Act’s prohibition in the context of requests for PII at the point of sale in brick and mortar stores has been unclear.


The question is whether the Act prohibits a retailer from requesting PII after the completion of the credit card transaction – for example, after the customer swipes her credit card and the receipt is printed – and whether a finding of liability requires a showing that consumers would objectively perceive the request for PII as a condition of making a credit card payment.

Civil Code section 1747.08(a)(2) states that no person who accepts credit cards may “request, or require as a condition to accepting the credit card for payment in full or in part for goods or services, the cardholder to provide personal identification information, which the person…accepting the credit card writes, causes to be written, or otherwise records upon the credit card transaction form or otherwise.”

Opportunistic plaintiffs

The plaintiff’s bar, relying on the placement of the commas in the statute (“request, or require as a condition…”), have argued that the Act prohibits any request for PII from a credit cardholder, irrespective of when the request is made.

The retailers in these lawsuits have argued that the California Legislature never intended to prohibit retailers from requesting PII from customers in order to build a marketing list.  The retailers argue the Legislature only intended to prohibit requests for PII when consumers could believe that the retailer requires the information to complete a credit card payment.

While several federal district courts have held that this interpretation of the Act is correct, no published California court opinion address whether a post credit card transaction request violated the Act.

Earlier this month, the Ninth Circuit in Davis v. Devanlay Retail Group, recognizing support for both constructions of the law in the various court opinions and legislative history, certified this issue to the California Supreme Court for review.

The Court of Appeal decision

But, earlier this week the California Court of Appeal, First Appellate District issued an opinion in Harrold v. Levi Strauss & Co., No. A142747 (Cal. Ct. App. First App. Dist., Div. 3 filed May 19, 2015) clarifying the Act’s prohibitions.  The court explained that the Act prohibits requests for personal identification information from credit card customers “at all times during and prior to the completion of a credit card transaction,” but, the Act’s prohibition does not continue beyond that point.

The court held that “the Act is violated only if the request is made under circumstances in which the customer could reasonably understand that the [PII] was required to process the credit card transaction.”

The court rejected the plaintiff’s contention that the placement of the commas controls the Act’s interpretation.  The court explained that “the very purpose of adding ‘request’ to the statute was to apply the prohibition against conditioning the acceptance of a customer’s credit card to a request as well as to a requirement.  The clause clearly was intended to apply to both a request and a requirement.”

The court explained “while the statute is intended to protect consumer privacy and to prohibit merchants from obtaining personal identification information under the mistaken impression the information is required to process a credit card transaction, the Act is not intended to forbid merchants from obtaining such information voluntarily, if the customer understands that the information need not be disclosed in order to use a credit card.”  (emphasis added).

The Court of Appeal was reviewing the trial court’s denial of class certification, and in denying class certification, the trial court analyzed the merits of the plaintiff’s claims.  The trial court found that the defendant retailer’s practice of delaying the request for email addresses until the receipt is printed and handed over to the customer, and the merchandise is bagged, did not violate the Act.  The Court of Appeal affirmed the trial court’s findings and stated that “such a request cannot reasonably be considered—by the customer or by anyone else—as a condition of acceptance of the credit card as a form of payment.”

We anticipate the plaintiff in Harrold will seek review in the California Supreme Court.  We should find out in the coming months whether the California Supreme Court will decide to take up the issue, either via an appeal in Harrold or the Ninth Circuit’s certification in Davis.  We will provide updates as events unfold.