Alvarez v. Brookstone: Applying Pineda Retroactively

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California’s Fourth Appellate District recently concluded that the Pineda v. Williams-Sonoma Stores decision applies retroactively.  See Alvarez v. Brookstone Co., No. D057567 (Cal. Ct. App. Dec. 20, 2011) (available here).  In Pineda v. Williams-Sonoma Stores, 51 Cal. 4th 524 (2011), the California Supreme Court held that the collection of ZIP codes as part of a credit card transaction violates California Civil Code section 1747.08.  Civil Code section 1747.08 prohibits businesses from requesting or recording “personal identification information,” but does not expressly forbid the collection of ZIP codes.  See Cal. Civ. Code § 1747.08 (a)(2) and (b).  The Supreme Court concluded in Pineda that “the only reasonable interpretation of section 1747.08 is that personal identification information includes a cardholder’s ZIP code.”  Id. at 534.

In 2008, the Alvarez plaintiff filed suit alleging that Brookstone violated section 1747.08 when its retail store cashiers requested and recorded customers’ ZIP codes.  Alvarez v. Brookstone Co., No. D057567 (Cal. Ct. App. Dec. 20, 2011), slip op. at 2.  In 2009, the trial court granted the defendant’s demurrer without leave to amend, on grounds that ZIP codes are not “personal identification information” pursuant to section 1747.08.  Slip. op. at 3.  The Court of Appeal reversed, holding that the state Supreme Court’s February, 2011 decision in Pineda is properly applied retroactively.  Slip op. at 6-11.  In its reasoning, the appellate court cited “the general rule of retrospective application of court decisions.”  Slip op. at 6. 

This ruling should prove helpful to California consumers who experienced ZIP code violations prior to the February 2011 ruling in Pineda.  The Alvarez plaintiff is now expected to proceed with her putative class action against Brookstone.