Making a purchase, or returning an item to the store? If you’re using a credit card in California, your customer status makes a difference. According to a recent decision from California’s Court of Appeal for the Second District, cardholders who purchase goods do not receive the same protections as those who return goods.
California’s consumer protection statute forbids merchants from requiring credit card users to provide personal identification information. (See § 1747.08(a)). Two years ago, David Absher purchased a locking gas cap from AutoZone. After discovering that the gas cap did not fit his car, he promptly went back to the store to return it. As part of AutoZone’s return policy, Absher was required to provide his telephone number to complete the transaction. In response, Absher filed a class action suit, alleging that AutoZone’s return policy violated the state’s consumer protection statute.
According to the statute, merchants cannot use forms with spaces designated for personal identification information in any credit card transaction. Absher argued that this applies to all credit card transactions, including returns. The court, however, held otherwise. First, the court found that the phrase “credit card transaction” did not “clearly and unambiguously” include all kinds of transactions. Next, the court analyzed the preceding provisions of the statute to determine the meaning of “credit card transaction.” Because those provisions explicitly applied to purchasing transactions, the court decided it would be inconsistent for “credit card transaction” to include returns.
Although consumers who return or exchange products may have to provide personal identification information, such as an address or a telephone number, this does not mean their information will be unprotected. There are many measures businesses can adopt to ensure protection of sensitive information. In fact, next August, the FTC and the California Office of Privacy Protection will host a workshop instructing businesses on ways to protect the personal information of its consumers and employees. The FTC’s website also has tips on how businesses can better protect personal information.