On Wednesday, a Massachusetts federal judge preliminarily approved an $875,000 class action settlement that would resolve claims that Michaels Stores Inc. improperly asked its customers to provide their ZIP code information during point of sale transactions.
The Michaels ZIP code settlement will resolve a class action lawsuit that alleged Michaels used the ZIP code information to allow the craft retailer to “reverse engineer” its customers’ addresses in violation of Massachusetts law. The class action lawsuit was filed in 2011 and asserted claims for unjust enrichment and violations of the Massachusetts Unfair Trade Practices Act.
According to the plaintiffs’ motion in support of the class action settlement, Michaels “asks certain consumers using credit cards to provide a ZIP code, which consumers do in the mistaken belief that they must in order to complete the transaction. In fact, Michaels is not required to collect its customers’ ZIP codes; to the contrary, [Michaels] uses a customer’s ZIP code and name to identify that customer’s address using commercially available databases. Michaels is thus able to use that personal identification information to send unwanted marketing material.”
U.S. District Judge William G. Young conditionally certified two settlement subclasses of Michaels customers who conducted a credit or debit card purchase transaction at a Massachusetts Michaels retail store between May 23, 2007 and Feb. 12, 2014, and from whom Michaels requested and recorded the customer’s personal information, including ZIP code information, during the transaction. The first subclass includes customers whose mailing addresses were obtained by Michaels based on their ZIP code information. The second subclass includes customers whose mailing addresses were obtained from a source not related to the ZIP code information.
Under the terms of the class action settlement, Michaels will mail cash value vouchers valued at $10 or $25. Class Members do not need to file a claim to be eligible for benefits under the Michaels ZIP code settlement. The vouchers can be used one time at any Michaels retail store in Massachusetts.
In agreeing to the class action settlement, Michaels has also agreed to take steps to delete all consumer addresses that were identified using ZIP code information that was acquired during point-of-sale credit or debit card transactions since May 23, 2007.
The final fairness hearing for the Michaels ZIP code settlement has been scheduled for May 20, 2014.
More information about the Michaels ZIP code class action settlement was not immediately available. Keep checking TopClassActions.com or sign up for our free newsletter for the latest updates. You can also use your free Top Class Actions Account to mark this article as a “Favorite” so that you will receive notifications when this article is updated.
The plaintiffs are represented by D. Greg Blankinship and Todd Garber of Meiselman Packman Nealon Sciallaba & Baker PC and Jeffrey I. Carton and Robert J. Berg of Denlea & Carton LLP.
The Michaels ZIP Code Class Action Lawsuit is In re: Michaels Stores Inc. ZIP Code Litigation, Case No. 1:11-cv-10920, in the U.S. District Court for the District of Massachusetts.
Have you been asked to provide your ZIP code during a debit or credit card transaction at a California or Massachusetts store? You may be eligible to participate in a class action lawsuit and pursue compensation. See if you qualify for free at the Merchant ZIP Code Class Action Lawsuit Investigation.
UPDATE: For more information about the Massachusetts Michaels ZIP code collection settlement, click here.
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