Filed 7/20/15 Adjamian v. L’Oreal
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION THREE
ALLEN ADJAMIAN, B257403
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BC504368)
v.
L ‘OREAL USA S/D, INC.,
Defendant and Respondent.
APPEAL from an order of the Superior Court of Los Angeles County,
Elihu M. Berle, Judge. Affirmed.
Wucetich & Korovilas, Jason M. Wucetich and Dimitrios V. Korovilas for
Plaintiff and Appellant.
Paul Hastings, Dennis S. Ellis, Katherine F. Murray and Nicholas J. Begakis for
Defendant and Respondent.
_______________________________________
Allen Adjamian, on behalf of himself and others similarly situated, filed a class
action complaint against L’Oreal USA S/D, Inc., owner and operator of Kiehl’s Since
1851 retail stores.1 Adjamian alleges Kiehl’s store employees requested personal
identification information (PII) from customers in connection with credit card
transactions in violation of the Song–Beverly Credit Card Act of 1971 (Civ. Code,
§ 1747 et seq.) (the Act). Adjamian appeals the denial of his motion for class
certification.
Adjamian contends (1) the trial court erroneously construed Civil Code
section 1747.08, subdivision (a)(2) and denied class certification based on its erroneous
construction of the statute, and (2) he presented sufficient evidence of a policy or
practice by Kiehl’s of violating the statute. We conclude Adjamian has shown no
prejudicial error. The trial court properly construed the statute. Substantial evidence
supports the court’s finding, by a preponderance of the evidence, that individual issues
will predominate on the question of liability. We therefore affirm the denial of class
certification.
FACTUAL AND PROCEDURAL BACKGROUND
1. Adjamian’s Allegations
Adjamian sued L’Oreal in March 2013. He filed a first amended complaint in
August 2013 and a second amended complaint in September 2013. Adjamian alleged
he bought merchandise from a Kiehl’s store in Canoga Park in February 2013 using
a credit card. Adjamian alleged that, during the transaction, the sales clerk asked for his
home address, telephone number, and e-mail address. He provided the requested
information. Adjamian alleged he “believes that information was recorded by” the sales
clerk. When the clerk gave Adjamian his receipt, “some of the [PII] requested and
recorded by [the Kiehl’s’] employee was printed on the receipt.”
Adjamian alleged Kiehl’s “engages in a pattern and practice of knowingly
requesting and recording [PII] of its customers at all its retail stores in California during
1
We refer to the defendant interchangeably as Kiehl’s and L’Oreal throughout this
opinion.
2
credit card transactions, including their addresses, e-mail addresses and/or phone
numbers . . . . ” Adjamian alleged Kiehl’s uses the PII “for unlawful purposes with the
objective of increasing sales from repeat customers and to generate additional revenue
for the company.” Adjamian also alleged Kiehl’s “shares or sells the [PII] it collects
from consumers to third parties.”
Adjamian alleged a single count for violation of Civil Code section 1747.08,
subdivision (a). He sought civil penalties for each violation under Civil Code
section 1747.08, subdivision (e), declaratory and injunctive relief, and attorney fees.
2. The Motion for Class Certification
a. Adjamian’s Moving Papers
In January 2014 Adjamian moved for class certification. He sought to certify
a class of “[a]ll California citizens who purchased merchandise with a credit card at
[a] Kiehl’s Since 1851 store operated by [L’Oreal] in California, from March 29, 2012,
to the present, who were requested to and did provide personal identification
information, including but not limited to their physical address, e-mail address,
telephone number, and/or zip code, which was then recorded by [Kiehl’s] during or in
conjunction with the credit card transaction, other than exclusively for shipping,
delivery, servicing, installation, or special order purposes.” Adjamian also sought to
certify a subclass limited to purchases between March 29, 2012, and August 31, 2013,2
but otherwise the same as the larger class.
Adjamian contended that Kiehl’s had a common “policy and practice of
unlawfully recording customers’ [PII] during credit card transactions, in violation of
[Civil Code] § 1747.08(a)” and that class certification was appropriate. Adjamian filed
his own declaration and declarations by his counsel, attaching documents L’Oreal had
produced in discovery. In his declaration, Adjamian expanded on the factual allegations
2
In the spring of 2013 Kiehl’s changed its point-of-sale software. (Adjamian
believed -- apparently erroneously -- that this software change happened in
September 2013.) In September 2013 Kiehl’s instituted a rewards program. Adjamian
contends these changes did not render Kiehl’s’ practices legal but he proposed
a subclass in an abundance of caution.
3
of his complaint. Adjamian stated the Kiehl’s sales clerk “recorded some or all of the
[PII] I provided by typing it into the electronic cash register system.” Adjamian
continued, “The sales clerk then completed the sale, and provided me with a credit card
transaction receipt that, in addition to printing my credit card sale information, also
printed some of my [PII] that had been collected, including my name, phone number,
and e-mail address.” Adjamian attached a copy of the receipt as an exhibit. The receipt
says “STORE RECEIPT COPY.” It seems to bear no signature. At the bottom of the
receipt Adjamian’s name, home telephone number, and e-mail address appear. In his
declaration, Adjamian stated the sales clerk never told him why his PII was being
collected or how it would be used. He said the clerk never told him “that providing my
[PII] was optional or to be done on a voluntary basis only.” Adjamian stated, “It
seemed to me as though providing my personal information to the sales clerk was
required and mandatory to the transaction because the clerk requested and recorded the
information at the cash register while the transaction was pending, prior to providing me
my receipt.”
Adjamian’s attorney submitted excerpts from Kiehl’s’ employee manuals and
training documents. One manual stated, “We attempt to create an ongoing relationship
by capturing every customer’s information in MARS.”3 A training document states,
“Remember to link every sale to an EXISTING customer or to enter information for
a NEW customer (both email and mailing address).” Kiehl’s’ training materials also
emphasize the importance of asking for and recording customers’ personal contact
information.
In support of his motion for class certification, Adjamian also requested judicial
notice of legislative history materials and orders by trial courts in other cases.
b. L’Oreal’s Opposition to the Class Certification Motion
L’Oreal argued in opposition to the motion that Civil Code section 1747.08,
subdivision (a)(2) prohibits requesting or requiring PII only in a manner that the
3
MARS is the point-of-sale software Kiehl’s began using in the spring of 2013.
4
customer reasonably would perceive as imposing a condition on accepting a credit card
payment. It asserted there was no evidence Kiehl’s had such a policy, so there was no
substantial evidence that common issues predominated. L’Oreal submitted declarations
from Kiehl’s’ director of retail operations, Anthony De Paola, and the assistant manager
of the Canoga Park store, Marina Hovhannisyan.
De Paola stated Kiehl’s has had a mailing list since 2006 called “Kiehl’s
Family”: customers can sign up to get information about products, special offers, and
store events. In September 2013 Kiehl’s began a rewards program: customers who join
can get discounts and free products. Kiehl’s also has a recycling program: customers
who choose to participate provide their names and a mailing or e-mail address so
Kiehl’s can track their participation. Until the spring of 2013 Kiehl’s used point-of-sale
software called CRS Retail Store Express. When a customer approached the register,
the sales clerk asked if the customer was a member of Kiehl’s Family. If so, the clerk
looked up the customer by name. If not, “the consumer could voluntarily provide
information to become a member.” If the customer then paid by credit card, the CRS
system printed two receipts: one marked “store receipt” for the customer to sign and
return to the clerk, and a second for the customer to keep. The store receipt reflected
the customer’s contact information if the customer already had provided it to join
Kiehl’s Family, on that day or on a prior occasion. The receipt given to the customer
displayed no customer information. Once Kiehl’s began using the MARS software,
neither the store receipt nor the customer receipt listed any customer information.
De Paola stated in his declaration that the receipt Adjamian attached to his
declaration was “unusual.” The receipt says “store receipt”; Adjamian should have
signed it and returned it to the clerk. After Adjamian filed his declaration in this case,
Kiehl’s searched its records and could not find any original store receipt signed by
Adjamian for his purchase in February 2013.
De Paola explained that Kiehl’s contracts with another company, Harte-Hanks
Data Technologies, to maintain and store its customer information and to send mail to
customers. Harte-Hanks does not sell or share Kiehl’s information with anyone.
5
Harte-Hanks’ database does not identify which Kiehl’s customers paid by credit card.
There is no way to tell from the database whether a customer whose name and address
appeared on the store’s copy of a receipt provided that information on the day he or she
shopped at Kiehl’s or on an earlier date.
Hovhannisyan stated in her declaration that she has worked for Kiehl’s since
2008, first as a sales clerk and then -- as of September 2012 -- as an assistant store
manager. From September 2012 to July 2013, Hovhannisyan worked under manager
Marissa Cabanilla at the Canoga Park store. Between July 2013 and December 2013
Hovhannisyan essentially was the manager for that store because there was no manager.
Hovhannisyan watched Cabanilla train new employees and Hovhannisyan then trained
new employees the same way. The receipt Adjamian attached to his declaration lists
“Morales” as the sales clerk. Cabanilla or Hovhannisyan, or both of them, trained
Morales.
Kiehl’s sales clerks are trained “to welcome the customers as they enter the store
and to engage them as soon as possible about their needs and any questions they might
have.” Clerks “offer each customer a seated consultation” and “appropriate samples.”
Kiehl’s trains its clerks “to open relationships with customers to allow them to follow
up regarding customer satisfaction, product use experience and ongoing skincare
needs.” Clerks are trained “to obtain the customers’ contact information, if customers
are willing to provide it, as soon as possible during the customer’s visit to Kiehl’s.”
Hovhannisyan encourages her clerks “to inquire as to whether a customer is a member
of Kiehl’s [F]amily during their initial contact with the customer when they are
welcoming the customer into the store.” If the customer has not already given Kiehl’s
his or her contact information, clerks are to ask the customer if he or she is willing to
provide that information “for follow up.” According to Hovhannisyan, “[t]his often
happens during the seated skin consultation . . . long before the customer decides to
make a purchase.” Hovhannisyan always tells her clerks “that they need to express to
customers that providing personal information is optional and that they should always
provide a reason as to why Kiehl’s is requesting the information.” Kiehl’s’
6
point-of-sale software “has nothing to do with [her] suggestion to [sales clerks] to
request customer contact information as early as possible during the customer’s visit to
Kiehl’s.”
Hovhannisyan stated in her declaration that Adjamian’s “description of his
shopping experience” at the Canoga Park Kiehl’s store and “the treatment [he] says he
received during his visit” was “highly unusual.” Adjamian’s statement that he was
asked for his personal information at the cash register when he presented his items for
purchase “would be exactly contrary to the way [clerks] at the Kiehl’s Canoga Park
store are trained.” Hovhannisyan stated Adjamian should have been offered a skin
consultation and product samples, and when he reached the counter to pay for the items
he should have been asked if he was a member of Kiehl’s Family. If he said no, the
clerk “would have been trained to ask [him] if he wished to become a member,” and if
he said yes the clerk “would then ask how [he] wished to be contacted.” Hovhannisyan
stated, “What Mr. Adjamian describes in his Declaration is in my mind is not something
we would do at the Kiehl’s Canoga Park store.” Hovhannisyan added, “[Sales clerks]
always ask for permission when requesting a customer’s contact information.” Finally,
Hovhannisyan noted the receipt Adjamian attached to his declaration was the store’s
copy for the customer to sign and the store to keep, “not a receipt that is normally
provided to Kiehl’s customers.”
In support of its opposition to the class certification motion, L’Oreal also
submitted excerpts of Adjamian’s testimony at his deposition in March 2014. Contrary
to his statement in his declaration dated January 31, 2014, that “it seemed to [him] as
though providing [his] personal information to the sales clerk was required and
mandatory to the transaction,” Adjamian testified at his deposition that he did not feel
that way.4 L’Oreal also asked Adjamian in his deposition about his earlier lawsuits
4
When asked “Did you feel that if you didn’t give them the information for their
database, you would not be able to purchase the items?” Adjamian replied “I don’t
recall feeling that way.” When asked “Do you remember thinking if I don’t give this
information, I can’t use my credit card to pay?” Adjamian answered, “I don’t recall such
7
against two other retailers for violations of the Song-Beverly Credit Card Act (in which
the same counsel represented him). L’Oreal’s attorney asked Adjamian whether -- in
light of those lawsuits -- he knew when he shopped at Kiehl’s that he did not have to
provide any personal information to use his credit card. Adjamian first answered that he
“might have been” familiar with the law. Then he testified that he “believe[d] [he] had
[the] knowledge” that the statute prohibits retailers from asking for PII “in connection
with a credit card transaction.” Two transcript pages later, however, Adjamian testified
that when he went up to the Kiehl’s counter, he had forgotten what the law prohibited.
Adjamian testified at his deposition that he has never spoken with anyone else
who shopped at Kiehl’s and that he does not know of anyone else who claims Kiehl’s
violated the Act.
In its opposition papers, L’Oreal argued that whether a violation occurred
depended on whether the individual consumer reasonably believed that providing his or
her personal information was a condition of using a credit card and that individual
issues of liability therefore predominated. It contended Adjamian also failed to satisfy
the other requirements for class certification.
3. The Hearing
On May 2, 2014, the trial court heard argument on the motion for class
certification. Adjamian’s counsel argued that the phrase in the Act “as a condition to
accepting [a] credit card as payment” applies only to a retailer’s “requir[ing]” of PII, not
to its “request” for PII. In other words, counsel contended the “as a condition” limiting
language applies to a retailer who “requires” PII but not to one who only “requests” PII.
Counsel argued the statute “prohibits a requesting and record of [PII] during or in
conjunction with” or “during” “the use of a credit card.” Therefore, counsel argued, the
a thinking like that.” When asked “So do you recall feeling that if you didn’t provide
your information you wouldn’t be able to go forward with your transaction?” Adjamian
responded, “I don’t recall feeling that.” Again Adjamian was asked, “At the time that
you were making your purchase and your request for information was requested of you,
did you believe that if you did not provide the information you would not be able to
make your purchase?” He answered “I don’t recall believing that.”
8
Act prohibits a retailer from asking a customer who pays with a credit card for PII at
any point “until after the transaction is over and [the retailer has] hand[ed] over the
receipt.” The trial court asked if Adjamian contended a retailer may not even ask
a customer who approaches the register “would you like to join our reward club?” and if
it must “wait until the transaction is complete and the customer has the receipt in hand
and the customer wants to leave and the store cashier should say ‘Wait, Wait, Wait,
Don’t leave yet, I want to talk to you? ’ ” Adjamian’s counsel said yes: that is what the
statute requires. Counsel suggested retailers may set up a kiosk, for example, by the
entrance to the store, away from the cash register, to handle loyalty and rewards
programs.
L’Oreal’s counsel argued that it did not “matter which way the
court . . . interpret[ed] the statute.” In any event, counsel contended, the court should
deny class certification “because of the way Kiehl’s does business.” Counsel asserted
Kiehl’s asks customers for PII when it gives them a product sample or when the
customer wants to join Kiehl’s Family. Counsel said Kiehl’s “relies on personalized
interactions with its customers,” offering them skin consultations, samples, free
products, and recycling. “All of those situations,” counsel argued, “provide
opportunities for a Kiehl’s employee to ask for [a] customer’s information that has
absolutely nothing to do with a credit card transaction. Doesn’t even happen at the cash
register area.” Counsel argued the evidence before the court did not show any policy or
practice by Kiehl’s of asking “everyone that shows up to the counter” for PII.
4. The Trial Court’s Ruling
After hearing from counsel, the trial court delivered its ruling in some detail. On
June 3, 2014, the court filed a signed order embodying that ruling. The court first
discussed the statute’s language and cases interpreting it, in particular Pineda v.
Williams-Sonoma Stores, Inc. (2011) 51 Cal.4th 524 (Pineda) and Florez v.
Linens ’N Things, Inc. (2003) 108 Cal.App.4th 447 (Florez). The order stated, “The
crux of Plaintiff’s argument in support of his Motion for Class Certification turns on the
interpretation of the statute.” The court rejected Adjamian’s argument that Civil Code
9
section 1747.08, subdivision (a) prohibits requesting PII in connection with a credit card
transaction even if providing that information was not a condition of accepting a credit
card payment. Citing Florez, the court stated a request for PII violates the statute only if
“a consumer would perceive the store’s request for information as a condition for the
use of the credit card.” Thus, the court concluded the statute prohibits a retailer from
requiring a credit card holder to provide PII in connection with a credit card transaction
and from requesting that information in a way that would cause a reasonable consumer
to believe that providing the information is a condition of accepting a credit card
payment.
The trial court found that individual issues predominate on the question of
liability because Adjamian failed to present substantial evidence of a policy or practice
by Kiehl’s specific to credit card transactions of requiring PII or causing a reasonable
customer to perceive such a requirement. The court stated, “According to Defendant,
customer information was not requested as a matter of routine during credit card
transactions, but it could be requested under varying circumstances, including by
entering the store, when paying for merchandise with cash, or when signing up online.
Whether L’Oréal USA violated the Song–Beverly Credit Card Act would therefore
depend on the circumstances surrounding a request for information because, as set forth
above, that involves whether the customer believed that providing his or her information
was a condition of consummating the credit card transaction. Such a question would
turn on the particular facts of each customer’s transaction, and is not subject to common
proof.” The court noted Adjamian “has presented no evidence of any Kiehl’s
transaction other than his own, and his deposition testimony shows that he did not recall
thinking he had to provide his personal information in order to use his credit card to
pay.”
The trial court also found Adjamian failed to show that common issues
predominate on liability even under Adjamian’s construction of the statute. Adjamian
presented no evidence, the court said, of a uniform policy or practice of requesting PII
“in connection with credit card transactions.” The order stated the evidence “fails to
10
show any policy about credit card transactions, whether information is required or
simply requested.” The order continued, “There is simply nothing before the Court to
suggest that Defendant had a standard policy throughout its California Kiehl’s stores
requiring or requesting personal information as a condition of or at least in connection
with credit card transactions. Individualized issues will, therefore, predominate on the
question of liability under the Song–Beverly Credit Card Act.”5
The trial court also found Adjamian’s transaction “was not typical of other
members of the putative class” and, “as Plaintiff is not typical, he is also not an
adequate representative.” The order stated it was not necessary to decide whether the
putative class was sufficiently ascertainable and numerous.
5. Appeal
Adjamian timely appealed the order denying class certification.6
CONTENTIONS
Adjamian contends the trial court misconstrued Civil Code section 1747.08,
subdivision (a)(2), and its findings that common issues do not predominate and that
Adjamian failed to satisfy the typicality and adequacy requirements were based on that
erroneous construction. According to Adjamian, he need prove only that Kiehl’s
requested and recorded PII from a customer who paid by credit card in order to establish
a violation of the statute, and he need not prove that providing that information was
actually or was perceived to be a condition of accepting a credit card payment.
5
The order also stated, “if requesting [PII] during or in connection with a credit
card transaction ipso facto gives rise to liability under the Song–Beverly Credit Card
Act, then the putative class members’ claims probably could be evaluated in one stroke
as Plaintiff asserts.” But, again, the court noted there was no evidence of a standard
policy of requesting PII in connection with credit card transactions and so individual
issues predominate.
6
An order denying class certification is appealable under the “death knell”
doctrine if it effectively terminates the class claims while allowing individual claims to
proceed. (In re Baycol Cases I & II (2011) 51 Cal.4th 751, 757-759.)
11
Adjamian also contends he presented sufficient evidence of a policy or practice by
Kiehl’s of requesting PII in connection with credit card transactions.
DISCUSSION
1. Class Certification Principles
“Code of Civil Procedure section 382 authorizes class actions ‘when the question
is one of a common or general interest, of many persons, or when the parties are
numerous, and it is impracticable to bring them all before the court . . . . ’ The party
seeking certification has the burden to establish the existence of both an ascertainable
class and a well-defined community of interest among class members. [Citations.]”
(Sav–On Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 326 (Sav–On).)
“[T]he ‘community of interest requirement embodies three factors: (1) predominant
common questions of law or fact; (2) class representatives with claims or defenses
typical of the class; and (3) class representatives who can adequately represent the
class.’ [Citation.].” (Fireside Bank v. Superior Court (2007) 40 Cal.4th 1069, 1089
(Fireside Bank).) “In certifying a class action, the court must also conclude that
litigation of individual issues, including those arising from affirmative defenses, can be
managed fairly and efficiently.” (Duran v. U.S. Bank National Assn. (2014)
59 Cal.4th 1, 28-29.)
“The ‘ultimate question’ the element of predominance presents is whether ‘the
issues which may be jointly tried, when compared with those requiring separate
adjudication, are so numerous or substantial that the maintenance of a class action
would be advantageous to the judicial process and to the litigants.’ [Citations.] The
answer hinges on ‘whether the theory of recovery advanced by the proponents of
certification is, as an analytical matter, likely to prove amenable to class treatment.’ ”
(Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1021 (Brinker).)
Thus, “[p]resented with a class certification motion, a trial court must examine the
plaintiff’s theory of recovery, assess the nature of the legal and factual disputes likely to
be presented, and decide whether individual or common issues predominate.” (Id. at
p. 1025.)
12
2. Standard of Review
We review an order granting or denying class certification for abuse of
discretion. (Sav–On, supra, 34 Cal.4th at pp. 326–327.) As “ ‘trial courts are ideally
situated to evaluate the efficiencies and practicalities of permitting group action, they
are afforded great discretion in granting or denying certification.’ ” (Id. at p. 326; see
also Fireside Bank, supra, 40 Cal.4th at p. 1089 [a decision to certify or not to certify
a class “rests squarely within the discretion of the trial court, and we afford that decision
great deference on appeal, reversing only for a manifest abuse of discretion”].)
Accordingly, such a ruling generally will not be disturbed unless it is (1) not supported
by substantial evidence, (2) based on improper criteria, or (3) based on erroneous legal
assumptions. (Fireside Bank, supra, 40 Cal.4th at p. 1089.) “Predominance is a factual
question; accordingly, the trial court’s finding that common issues predominate
generally is reviewed for substantial evidence. [Citation.] We must ‘[p]resum[e] in
favor of the . . . order . . . the existence of every fact the trial court could reasonably
deduce from the record . . . . ’ [Citation.]” (Brinker, supra, 53 Cal.4th at p. 1022.)
3. Substantial Evidence Supports the Trial Court’s Predominance Finding
The trial court determined the proposed class lacked the requisite community of
interest because Adjamian failed to establish predominant common questions of fact.
Adjamian contends the trial court’s findings were based on its erroneous construction of
Civil Code section 1747.08, subdivision (a)(2). Adjamian argues the Act prohibits any
and all requests for PII of any customer who ends up paying with a credit card before
the transaction is completed, regardless of the circumstances in which the request is
made. That Kiehl’s’ sales clerks request some customers’ PII before the customer
presents a credit card for payment, or even before the customer suggests he or she
intends to purchase merchandise, does not change the analysis in Adjamian’s view.
13
“In 1990, the Legislature enacted former [Civil Code] section 1747.87 (Assem.
Bill No. 2920 (1989-1990 Reg. Sess.) § 1), seeking ‘to address the misuse of personal
identification information for, inter alia, marketing purposes, and [finding] that there
would be no legitimate need to obtain such information from credit card customers if it
was not necessary to the completion of the credit card transaction.” (Pineda, supra,
51 Cal.4th at p. 534, quoting Absher v. AutoZone, Inc. (2008) 164 Cal.App.4th 332, 345
(Absher).) “To protect consumers, the Legislature sought to prohibit businesses from
‘requiring information that merchants, banks or credit card companies do not require or
need.’ [Citation.]” (Id. at p. 535.) A year later, in 1991, the Legislature amended the
statute, broadening the provision to forbid businesses from “ ‘[r]equest[ing], or
requir[ing] as a condition to accepting the credit card . . . , the cardholder to provide
personal identification information . . . . ’ [Citation.]” (Ibid.)
California courts have rejected Adjamian’s contention that the statute “imposes
an absolute prohibition on requesting [PII] from credit card customers.” (Harrold v.
Levi Strauss & Co. (2015) 236 Cal.App.4th 1259, 1265 (Harrold).) As the Harrold
court noted, “the very purpose of adding ‘request’ to the statute was to apply the
prohibition against conditioning the acceptance of a customer’s credit card to a request
as well as to a requirement.” (Id. at p. 1266.) “The [‘as a condition’] clause clearly was
intended to apply to both a request and a requirement.” (Ibid.; see also Absher, supra,
164 Cal.App.4th at p. 344 [noting “the punctuation in [section 1747.08,]
subdivision (a)(1) and (a)(2) is not punctilious” but rejecting the plaintiff’s argument
there “that the qualifying phrase ‘as a condition to accepting the credit card as payment’
applies only to ‘require,’ not to ‘request’ ”].)
As the Harrold court observed, “[s]everal courts, both state and federal, have
recognized that the Act does not preclude merchants from operating e-mail marketing
programs and requesting consumers to voluntarily provide their e-mail addresses or
other identification information for use in such programs.” (Harrold, supra,
7
The statute was later amended and renumbered as section 1747.08. (Stats. 2004,
ch. 183, § 29.)
14
236 Cal.App.4th at p. 1267.) “In Florez, the Court of Appeal expressly noted ‘that
nothing prevents a retailer from soliciting a consumer’s address and telephone number
for a store’s mailing list, if that information is provided voluntarily.’ ” (Ibid.) “In Gass
v. Best Buy Co., Inc. (C.D. Cal. 2012) 279 F.R.D. 561, the district court embraced that
view, noting that if the phrase ‘ “as a condition to accepting the credit card” ’ does not
apply to the word ‘request,’ ‘ “then nothing ties a violation of the Act to a credit card
transaction at all. . . . [¶] . . . [¶] Such a construction would mean that no business in
California that accepts credit cards as payment can maintain a mailing list.” ’ ”
(Harrold, supra, 236 Cal.App.4th at p. 1267.)
As the trial court here noted, Florez stated “[w]hat . . . matter[s] is whether
a consumer would perceive the store’s ‘request’ for information as a ‘condition’ of the
use of a credit card.” (Florez, supra, 108 Cal.App.4th at p. 451 [emphasis in original].)
The trial court found that -- while Kiehl’s unquestionably has a policy and practice of
trying to get customers’ contact information by signing them up for its loyalty and
rewards programs -- “[t]he evidence does not show a routine course of conduct of
asking for customers’ [PII] during a [credit card] transaction.” Thus, the court
concluded, whether L’Oreal violated the Act “would therefore depend on the
circumstances surrounding a request for information because . . . that involves whether
the customer believed that providing his or her information was a condition of
consummating the credit card transaction.” So, the court said, “[s]uch a question would
turn on the particular facts of each customer’s transaction, and is not subject to common
proof.”
Substantial evidence supports the trial court’s findings. Kiehl’s’ documents
show -- and its assistant store manager readily admits -- that Kiehl’s trains its sales
clerks to ask customers for their contact information. These efforts begin when the
customer walks into the store and last until the customer leaves. Customers are asked
for their contact information when the clerk first greets them upon arrival, when they sit
down for a skin consultation, and when they are given product samples. Customers are
asked if they are members of the retailer’s loyalty club, Kiehl’s Family; if not, if they
15
would like to join; if they would like to enroll in the rewards program; and if they would
like to participate in Kiehl’s’ recycling program. The clear implication from the
evidence before the trial court is that Kiehl’s seeks to get contact information from
customers at various times, and through various efforts, before the customer ever
presents a credit card for payment. Indeed, the evidence supports a reasonable inference
that Kiehl’s, in at least some instances, requests PII even before the customer has any
thought of purchasing merchandise with a credit card at all.
Because a retailer is liable for a violation of section 1747.08, subdivision (a)(2)
only if “a consumer would perceive the store’s ‘request’ for information as a ‘condition’
of the use of a credit card” (Florez, supra, 108 Cal.App.4th at p. 451), the varied
circumstances in which Kiehl’s requests PII from its customers present individualized
factual issues that cannot be jointly tried in a class action. (See Brinker, supra,
53 Cal.4th at p. 1021.) Though a jury might conclude that a customer would perceive
a request for PII to be a condition of the use of a credit card were the request made after
the customer presented the card for payment, the same jury could reasonably conclude
that no customer would perceive the request to be a condition for paying with a credit
card if the evidence showed Kiehl’s’ clerk made the request immediately upon greeting
the customer when he or she entered the store. In view of the evidence presented to the
trial court, the circumstances of each customer interaction must be evaluated to
determine what a reasonable customer would have perceived about the request for PII
vis-à-vis the subsequent credit card transaction and, hence, whether the request
constituted a violation of the Act. The trial court reasonably concluded individualized
issues would predominate based on this evidence.
Evidence that Kiehl’s’ computers allow sales clerks to record customer contact
information does not, standing alone, establish a violation of the Act. A retailer is not
required to have two separate computer systems -- one to process payments and one to
input and maintain contact information for customers who join loyalty or rewards
programs -- to avoid violating the Act. Adjamian makes much of the fact that his name,
telephone number, and email address were printed on the store receipt he attaches to his
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declaration.8 But this evidence establishes only that Kiehl’s records PII; it does not
establish that the store maintains a uniform policy that can be evaluated to assess on
a class-wide basis whether every customer whose PII was requested would “perceive
the store’s ‘request’ for information as a ‘condition’ of the use of a credit card.”
(Florez, supra, 108 Cal.App.4th at p. 451.) Adjamian’s evidence concerning Kiehl’s’
practice of recording PII tells only half the story. That evidence did not compel the trial
court to conclude a violation could be established on a class-wide basis, given the
evidence Kiehl’s presented concerning the varied circumstances in which it requests PII
from its customers.
In sum, substantial evidence supports the trial court’s finding that common issues
do not predominate. The court did not abuse its considerable discretion in denying class
certification. In light of our conclusion, we need not decide whether the trial court
properly found that Adjamian failed to satisfy the typicality and adequacy requirements.
(See Hataishi v. First American Home Buyers Protection Corp. (2014) 223 Cal.App.4th
1454, 1469.)
8
As De Paola explained in his declaration, the customer name and contact
information appeared on the store’s copy of the receipt when Kiehl’s used the CRS
system “if it had already been provided in connection with the consumer’s election to
join the Kiehl’s Family.”
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DISPOSITION
The order is affirmed. L’Oreal is entitled to recover its costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
EGERTON, J.*
WE CONCUR:
EDMON, P. J.
ALDRICH, J.
*
Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant
to article VI, section 6 of the California Constitution.
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