The opinion
Filed 5/19/15
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION THREE
STACIE HARROLD,
Plaintiff and Appellant,
A142747
v.
LEVI STRAUSS & CO. et al., (Napa County
Super. Ct. No. 26-60136)
Defendants and Respondents.
Plaintiff Stacie Harrold appeals from an order denying her motion to certify a class
in her action against Levi Strauss & Co. and Levi’s Only Stores, Inc. (collectively,
Levi’s) for requesting and recording email addresses from customers paying for
purchases with a credit card, allegedly in violation of the Song-Beverly Credit Card Act
of 1971 (Civ. Code, § 1747 et seq.)1 (the Act), specifically section 1747.08. The trial
court determined that plaintiff’s complaint fails to satisfy the requirements for
certification of a class, based on its conclusion that section 1747.08 does not prohibit the
collection of personal identification information once a credit card transaction has been
concluded. The appeal turns on the correctness of this interpretation of the Act. Since we
conclude the trial court correctly interpreted the statute, we shall affirm the order denying
class certification.
Background
Plaintiff’s first amended complaint alleges that “plaintiff entered into a credit card
purchase transaction with defendants, which did not involve mail order, shipping or cash
advances. However, as part of defendants’ information capture policy, and in conjunction
1
All statutory references are to the Civil Code.
1
with the credit card sales transaction, plaintiff was asked for personal identification
information, in the form of her email address, by defendants’ employee attending to the
transaction. [¶] . . . Plaintiff provided the requested personal identification information,
which was entered into the electronic sales register at the checkout counter adjacent to
both defendants’ employee and plaintiff.” The amended complaint continued:
“Defendants’ conduct as alleged herein expressly violated California Civil Code section
1747.08. Civil Code section 1747.08(a)(2) provides, in relevant part, that: [N]o person,
firm, partnership, association, or corporation that accepts credit cards for the transaction
of business shall . . . request, or require as a condition to accepting the credit card as
payment in full or in part for goods or services, the cardholder to provide personal
identification information, which the person, firm, partnership, association, or
corporation accepting the credit card writes, causes to be written, or otherwise records
upon the credit card transaction form or otherwise. (emphasis added).” For purposes of
this appeal, Levi’s has assumed, as shall we, that an email address is “personal
identification information” within the meaning of this provision.2
The amended complaint defines the purported class as “all persons from whom
defendants requested and recorded personal identification information in conjunction
with a credit card purchase transaction at a California retail store during [a defined time
period].” 3
In support of her motion for certification of such a class plaintiff submitted her
own declaration in which she stated: “On July 14, 2012, I visited the Levi’s store in
Napa, California. [¶] . . . On that occasion, after selecting the items that I intended to
2
Section 1747.08, subdivision (b) provides: “For purposes of this section, ‘personal
identification information’ means information concerning the cardholder, other than
information set forth on the credit card, and including, but not limited to, the cardholder’s
address and telephone number.” (See Powers v. Pottery Barn, Inc. (2009) 177
Cal.App.4th 1039 [email addresses].)
3
The purported class excluded persons using credit cards issued to a business, persons
coming within the scope of certain exceptions contained in section 1747.08,
subdivision (c), and persons connected in defined ways to Levi’s and its affiliates. None
of these exclusions is relevant to the present controversy.
2
purchase, I proceeded to the cashier’s section of Levi’s store to pay for the merchandise
using a credit card. After I provided the items to the cashier at the register, the cashier
informed me of the amount due. I then paid for the merchandise using my credit card.
[¶] . . . While I was standing at the cash register for my credit card purchase transaction,
Levi’s cashier requested my email address. Per the cashier’s request, I provided the
cashier with my email address.” At her deposition, plaintiff testified she did not recall
whether the request was made before or after she had signed for the purchase but that it
was before the purchased merchandise was bagged and handed to her.
The papers submitted in support of and in opposition to the class certification
motion indicate that Levi’s conducts an email marketing program and has a written
policy concerning precisely when and how store clerks should request from customers
their email address for inclusion in the program. The documents articulating this policy
have been filed under seal, so that we shall not here recite the particulars, but it is
undisputed that under this policy the customer’s email address is not to be requested until
after the credit card purchase transaction has been completed. Except to the extent that
plaintiff’s testimony may indicate a departure from this policy in the case of her
purchase, no evidence was submitted indicating that the policy is not universally
followed. Levi’s submitted substantial evidence to the effect that employees are trained to
adhere to this policy and that they “always wait[] until the receipt is printed, handed over
to the customer and the merchandise is bagged before providing customers the
opportunity to join the email program” and requesting their email address. Except for
plaintiff’s testimony, the record contains no evidence of instances in which the policy has
not been observed.
In denying class certification, the trial court held that section 1747.08 prohibits
requests for personal identification information only “as a condition to accepting the
credit card as payment” and that, therefore, such a request made after the credit card
transaction has been completed does not violate the statute. Thus, class certification is not
appropriate, the court ruled, because plaintiff failed to show that there is a numerous class
of persons whose email addresses have been obtained in violation of the terms of the
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statute. Moreover, since plaintiff has alleged that her email address was requested before
the transaction was completed, contrary to the policy that the evidence shows was applied
to all other Levi’s customers, her claim is not typical of the claims of other purported
class members.
Plaintiff has timely appealed from the order denying class certification.4
Discussion
Plaintiff contends that the trial court’s ruling is based on an incorrect interpretation
of section 1747.08. Plaintiff argues that “[r]egardless of when the cashier obtains a credit
card customer’s [personal identification information], whether it is prior to handing the
customer the receipt and merchandise or a split second after, the retailer is still amassing
unnecessary [personal identification information]. . . . [¶] Regardless of whether [Levi’s]
requested a credit card customer’s [personal identification information] at the beginning,
middle, or end of the transaction, it still violated section 1747.08. A violation of
section 1747.08 occurs when a retailer requests and records [personal identification
information] from a customer who pays by credit card.”
“The Song-Beverly Credit Card Act of 1971 . . . is ‘designed to promote consumer
protection.’ [Citation.] One of its provisions, section 1747.08, prohibits businesses from
requesting that cardholders provide ‘personal identification information’ during credit
card transactions, and then recording that information.” (Pineda v. Williams-Sonoma
Stores, Inc. (2011) 51 Cal.4th 524, 527, italics added, citing Civ. Code, § 1747.08,
subd. (a)(2).)5 We agree with plaintiff that the prohibition applies at all times during and
4
The order is an appealable order. (Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435.)
5
Section 1747.08, subdivision (a) provides, in pertinent part: “[N]o person, firm,
partnership, association, or corporation that accepts credit cards for the transaction of
business shall . . . . [¶] . . . [¶] (2) Request, or require as a condition to accepting the
credit card as payment in full or in part for goods or services, the cardholder to provide
personal identification information, which the person, firm, partnership, association, or
corporation accepting the credit card writes, causes to be written, or otherwise records
upon the credit card transaction form or otherwise.” (Italics added.)
4
prior to the completion of a credit card transaction. However, there is no support for her
contention that the prohibition continues beyond that point.
Plaintiff does not dispute that a credit card purchase may reasonably be considered
to have been concluded when the customer receives a receipt for the purchase, following
acceptance of the credit card, and the merchandise has been delivered to the customer.
Levi’s policy does not permit the sales clerk to ask the customer about joining its email
program or to request the customer’s email address prior to that point. The transaction
having been concluded, 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.
Plaintiff contends that the phrase “as a condition to accepting the credit card as
payment in full or in part for goods or services” qualifies only the prohibition of
“requiring” the submission of personal identification information as a condition to
acceptance of the credit card for payment. She argues that this phrase does not qualify the
prohibition of “requesting” such information from credit card customers. Plaintiff argues
that this interpretation is required by the “last antecedent rule” of statutory interpretation
under which by virtue of the comma following the word “request” in section 1747.08,
subdivision (a)(2) (see fn. 4, ante), the “as a condition” clause qualifies only the word
“require.” (White v. County of Sacramento (1982) 31 Cal.3d 676, 680.) Under this
reading, the statute imposes an absolute prohibition on requesting personal identification
information from credit card customers. However, as White recognizes, there are two
exceptions to this rule of statutory construction. First, the rule does not apply if the clause
in question is equally applicable to the words before and after the comma. (Id. at pp. 680-
681.) And secondly, the rule does not apply ‘ “[w]here the sense of the entire act requires
that a qualifying word or phrase apply to several preceding wo[r]ds.’ ” (Id. at p. 681; see
also the second case on which plaintiff relies, Demchuk v. State Dept. of Health Services
(1991) 4 Cal.App.4th Supp. 1, 4 [rule inapplicable if “the context or evident meaning of
the statute requires a different construction”].)
5
Both exceptions apply in the present case. As our Supreme Court explained in
Pineda v. Williams-Sonoma Stores, Inc., supra, 51 Cal.4th at page 535, “the 1990 version
of former section 1747.8 [now section 1747.08] forbade businesses from ‘requir[ing] the
cardholder, as a condition to accepting the credit card, to provide personal identification
information . . . .’ (Stats. 1990, ch. 999, § 1, p. 4191.) In 1991, the provision was
broadened, forbidding businesses from ‘[r]equest[ing], or requir[ing] as a condition to
accepting the credit card . . . , the cardholder to provide personal identification
information . . . .’ (Stats. 1991, ch. 1089, § 2, p. 5042, italics added.) ‘The obvious
purpose of the 1991 amendment was to prevent retailers from “requesting” personal
identification information and then matching it with the consumer’s credit card number.’
[Citation.] ‘[T]he 1991 amendment prevents a retailer from making an end-run around
the law by claiming the customer furnished personal identification data “voluntarily.” ’ ”
Thus, 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. As the Court of Appeal recognized in Absher v. AutoZone, Inc. (2008) 164
Cal.App.4th 332, 342, citing legislative history to the 1991 amendment,6 the Legislature’s
“stated purpose” of the amendment “was to clarify that merchants ‘may neither require
nor request, as a condition to accepting the credit card, the taking or recording of
personal identification information from the cardholder.’ ” (Id. at p. 342, italics added.)
Moreover, 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.
Neither the legislative history nor the cases that have interpreted the statute indicate that
6
(Assem. Com. on Banking, Finance and Public Indebtedness, Rep. on Assem. Bill
No. 1477 (1991-1992 Reg. Sess.) May 13, 1991.)
6
the Act prohibits merchants from requesting personal identification information if the
request is not made under circumstances suggesting that a credit card will not be accepted
as payment without such information. The statute “dovetails with policy by prohibiting
the solicitation of information obtained under the false pretense that the transaction
cannot or will not be completed without it.” (Florenz v. Linens ‘N Things, Inc. (2003) 108
Cal.App.4th 447, 452.) “As evidenced by the 1991 amendment, section 1747.8 [now
section 1747.08] is designed to prevent a ‘request’ for personal information, because a
customer might perceive that request as a condition of credit card payment. In effect, the
1991 amendment prevents a retailer from making an end-run around the law by claiming
the customer furnished personal identification data ‘voluntarily.’ In fact, the Enrolled Bill
Report of the California Department of Consumer Affairs, Assembly Bill No. 1477
(1991-1992 Reg. Sess.), specifically addressed this problem, noting ‘[t]his bill would
prohibit requesting or requiring that information.’ As we read it, the legislative intent
suggests the 1991 amendment simply clarified that a ‘request’ for personal identification
information was prohibited if it immediately preceded the credit card transaction, even if
the consumer’s response was voluntary and made only for marketing purposes.” (Id. at
p. 453.) And more recently in Apple, Inc. v. Superior Court (2013) 56 Cal.4th 128, 139-
140, our Supreme Court observed that an analysis in a report of the Senate Committee on
Judiciary noted that “the ‘problem’ the bill was designed to address was retailer’s
practice of leading consumers ‘to mistakenly believe that [personal identification
information] is a necessary condition to complete the credit card transaction, when, in
fact, it is not’ ” and then using the information for the retailer’s own business purposes.
Several courts, both state and federal, have recognized that the Act does not
preclude merchants from operating email marketing programs and requesting consumers
to voluntarily provide their email addresses or other identification information for use in
such programs. In Florenz, the Court of Appeal expressly noted “that nothing prevents a
retailer from soliciting a consumer’s address and telephone number for a store’s mailing
list, if that information is provided voluntarily.” (Florenz v. Linens ‘N Things, Inc., supra,
108 Cal.App.4th at p. 451.) In Gass v. Best Buy Co., Inc. (C.D. Cal. 2012) 279 F.R.D.
7
561, the district court embraced that view, noting that if the phrase “as a condition to
accepting the credit card” does not apply to the word “request,” “then nothing ties a
violation of the Act to a credit card transaction at all. . . . Such a construction would mean
that no business in California that accepts credit cards as payment can maintain a mailing
list.” (Id. at pp. 569-570, bold deleted.) The district court rejected this interpretation of
the statute. In denying an overly broad motion for class certification the court held that
the statute is violated only if the request is made under circumstances in which the
customer could perceive the request for personal identification as a condition of
completing a credit transaction. Indeed, the court did not limit the circumstances under
which the request may properly be made to requests following completion of the credit
card transaction, but ruled that if “[a] business requests a customer’s [personal
identification information] during a credit card transaction, but does so in a manner such
that no reasonable customer could perceive the request as a condition for the business
accepting the credit card,” the Act is not violated. (Id. at pp. 570-572.) In Gormley v.
Nike, Inc. (N.D.Cal., Jan. 28, 2013, No. C 11-893 SI) 2013 U.S. Dist. Lexis 11278, the
retailer’s policy, very similar to Levi’s policy, provided that credit card customers were
not to be asked for personal identification information “until after the credit card was
authorized and the receipt was printing” (id. at p. *5). The district court rejected the
plaintiffs’ contention that requests for personal identification information made in
compliance with this policy violated the statute and that the Act prohibits any request for
such information in conjunction with a credit card transaction. The court thus denied a
motion for class certification on the ground that the named plaintiffs, who alleged that the
policy had not been observed when their personal information was requested, were not
typical of the purported class. The court held that the legality of the store’s action
depended on “whether a consumer would perceive the store’s request . . . as a condition
of the use of a credit card.” (Id. at pp. **24-25; see also, e.g., Rothman v. General
Nutrition Corp. (C.D.Cal., Nov. 17, 2011, No. CV 11-03617 SJO (RZx)) 2011 U.S.Dist.
Lexis 134515, pp. **16-17 [“[I]f the personal information is requested as opposed to
required, whether there has been a violation of the Act would depend upon whether the
8
individual consumer reasonably believed that providing his personal information was a
condition of consummating the credit card transaction.”].)
Thus, consistent with all prior reported decisions, we conclude that the trial court
correctly refused to certify a class in this action. In this case the merits of plaintiff’s claim
are “enmeshed with class action requirements.” (Linder v. Thrifty Oil Co., supra, 23
Cal.4th 429, 443.) Were plaintiff correct that Levi’s violated the Act by requesting email
addresses from any customer using a credit card for payment, regardless of whether the
credit card had already been approved and the transaction concluded, the requirements of
a class action might well be satisfied. However, since the Act is violated only if the
request is made under circumstances in which the customer could reasonably understand
that the email address was required to process the credit card transaction, and since such
an understanding could not reasonably be conveyed by a request made after the
transaction has been concluded, those requirements are not met. Plaintiff has made no
showing that there are numerous, or indeed any, customers other than herself from whom
Levi’s has requested email addresses in nonconformity with company policy — i.e., prior
to the completion of a credit card transaction. Thus plaintiff has failed to establish the
necessary numerosity, the existence of an ascertainable class, or that her claim is typical
of the purported class she seeks to represent. (See, e.g., id. at p. 435.)
Disposition
The order denying class certification is affirmed. Levi’s motion for sanctions is
denied.
9
_________________________
Pollak, Acting P.J.
We concur:
_________________________
Siggins, J.
_________________________
Jenkins, J.
10
Trial Court: Napa County Superior Court
Trial Judge: Hon. Diane M. Price
Counsel for Plaintiff and Appellant: STONEBARGER LAW, APC
Gene J. Stonebarger
PATTERSON LAW GROUP
James K. Patterson
ATKINS & DAVIDSON, APC
Todd C. Atkins for The Consumer Federation of
California as amicus curiae on behalf of appellant.
Counsel for Defendants and SHEPPARD, MULLIN, RICHTER &
Respondents: HAMPTON LLP
P. Craig Cardon
Brian R. Blackman,
Elizabeth S. Barcohana
NORTON ROSE FULBRIGHT
Jeffrey B. Bargulies and Lauren A. Shoor for
California Retailers Association as amicus curiae
on behalf of respondents.
11