Massachusetts PII Ruling - Retailers Beware

Monday, March 18, 2013 Listrak 0 Comments

James Koons
In connection with a class action lawsuit filed against Michaels Stores Inc. (Tyler vs. Michaels Stores, Inc. - SJC-11145), the United States District Court for the District of Massachusetts certified to the Supreme Judicial Court of Massachusetts three questions: (1) whether a ZIP code constitutes personal identification information; (2) whether, under the Massachusetts statute prohibiting collection of personal identification information during a credit card transaction, a plaintiff may pursue a claim without any evidence of identity theft; and (3) whether, under the statute a “credit card transaction form” includes an electronic transaction form.  Earlier this week, the Supreme Court answered “yes” to all three of these questions - (1) a zip code constitutes personal identification information for purposes of the statute; (2) a plaintiff may bring an action for violation of the statute absent identity fraud; and (3) the term “credit card transaction form” in the statute refers equally to electronic and paper transaction forms.
A copy of the Court’s opinion and associated briefs can be found here.
The Supreme Court’s decision will most likely open the door to even more lawsuits against retailers in the state of Massachusetts.  Plaintiffs may now file actions against retailers who collect ZIP code information during a credit card transaction and, consistent with the Supreme Court’s broad interpretation of personal identification information (PII), plaintiffs may try to expand the definition of PII even further to include other types of information.
In addition, the Court’s decision has lowered the bar for plaintiffs who struggle to prove that they have been injured in these cases.  Under the ruling, a plaintiff no longer needs to demonstrate that they have suffered identity theft in order to maintain a cause of action.  Significantly, the Court stated that receipt of unwanted marketing materials or the sale of a consumer’s PII to a third-party can constitute an injury sufficient to maintain an action.  As a result of the Supreme Court’s decision, retailers in Massachusetts should review, evaluate and revise their data collection practices as needed.

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