A California federal court recently narrowed further the scope of California’s Song-Beverly Credit Card Act (Cal. Civ. Code § 1747.08), which limits the information retailers can collect during credit card transactions, by holding that the Act does not apply to on-line credit card sales of shipped goods. In its April 30, 2013, opinion in Ambers v. Buy.com, the U.S. District Court for the Central District of California extended the rationale of the California Supreme Court’s holding earlier this year that the Song-Beverly Act does not apply to on-line credit card sales of downloaded goods. While potentially providing on-line retailers some guidance regarding the information they can permissibly collect from California residents to aid in fraud prevention and other efforts, the holding is subject to appeal and does not apply to brick-and-mortar sales nor outside of California.
The Ambers action was brought in February 2013, when Michael Ambers filed suit against Buy.com on behalf of himself and a putative class of Buy.com’s customers in the Central District of California alleging that the company violated the Song-Beverly Act by requiring him to provide a telephone number when he purchased, and had shipped, a set of DVDs online using a credit card. Buy.com filed a motion to dismiss Ambers’ complaint, arguing that the Song-Beverly Act does not apply to online transactions, based on the California Supreme Court’s Apple, Inc. v. Superior Court of Los Angeles County, 56 Cal. 4th 128 (Feb. 4, 2013) decision. The district court agreed, dismissing the case.
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