Fashion Counsel with Anthony V. Lupo

Arent Fox's fashion law blog offers news, analysis, and insights for the industry from fashion attorney Anthony Lupo.

Fashion Counsel with Anthony V. Lupo

Class Actions Targeting Fashion Retailers on the Rise in Massachusetts

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Class Actions Targeting Fashion Retailers on the Rise in Massachusetts

In the year since the Massachusetts Supreme Judicial Court ruled that retailers cannot collect ZIP codes from consumers using credit cards, the number of class actions alleging that retailers have violated the law have soared.

A little more than 12 months ago, the high court in Massachusetts ruled that retailers requesting and recording ZIP codes from consumers during credit card transactions violate Massachusetts General Laws, c. 93, § 105, a consumer protection statute prohibiting the collection of personal identification information from consumers using credit cards. The law is designed to address retailers’ practice of leading consumers to mistakenly believe that providing personal information is necessary to complete a credit card transaction when, in fact, it is not. The overriding purpose of the statute is to protect the personal privacy of consumers who pay for transactions with credit cards so that they do not unwillingly become a target of retailers’ marketing efforts.

In the case, the class plaintiff alleged that Michaels Stores, Inc. violated § 105 when its employees requested and recorded only a portion of customers’ addresses — namely, ZIP codes — while processing credit card transactions. The high court agreed.

Since the Michaels ruling a little over a year ago, more than 17 class actions have been filed against retailers based on their alleged collection of ZIP codes from their customers. Nine cases have been filed in 2014. Defendant retailers include Donna Karan, Jos. A. Bank, Apple, Williams–Sonoma, Patagonia, PetSmart, Lowe’s, J. Crew, J.C. Penney, Kohl’s, and Bed Bath & Beyond. The cases are in varying stages — some settled at the outset of the litigation, but others are in the throes of discovery. The cases have been brought by about 10 different plaintiffs, many of whom use the same plaintiffs’ counsel. Given this marked increase in cases alleging that retailers have improperly collected ZIP codes, retailers and defense counsel should expect more cases to be filed soon.

For more information about this case or other consumer protection issues, please contact Anthony V. Lupo or Leah C. Montesano, or the Arent Fox professional who handles your matters.

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