Cert. Granted in Wal-Mart ZIP Code Class Action Lawsuit

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A federal judge ruled that despite some minor differences regarding a big box retailer’s handling of various credit card transactions, the overall issues merited certification of a Wal-Mart ZIP code class action lawsuit.

The lead plaintiff alleged that she was asked for her ZIP code while making a purchase at Wal-Mart with her American Express credit card as well as her Visa credit card. According to the Wal-Mart class action lawsuit, this runs afoul of California’s Song Beverly Act limiting the personal identifying information required to complete a credit card transaction.

U.S. District Judge Troy L. Nunley wrote that defendant’s argument that Wal-Mart had entered into agreements with Discover and American Express to require additional identification above certain dollar amounts was unconvincing. He also included in the order granting Class certification mention of plaintiffs’ allegation that state or federal ID cards could have helped verify them.

Further, the retailer had also argued that while it did have a policy regarding American Express cards, as well as Discover cards, it did not “acknowledge that this was done with VISA cards[.]” Still, the sheer number of purchases made with credit cards issued by the various companies, Judge Nunley wrote, meant that the applicable Class was estimated to be at least 100,000 people.

Judge Nunley also wrote that Wal-Mart did not make a compelling argument regarding corporate credit cards, noting that the company “did not challenge the class definition at the pleading stage” and further agreeing with the plaintiffs that they cannot “anticipate every unannounced affirmative defense a defendant may want to forward.” What the plaintiffs did do was plausibly allege a policy that violated the Song Beverly Act regarding the use of certain types of credit cards at the stores, according to the judge’s order certifying the Wal-Mart class action lawsuit.

He also noted that while another California federal court had ruled in favor of a retailer, the case regarding Ikea was significantly different. There, company officials were able to demonstrate that cashiers had a uniform policy that included other ways for customers to prove their identities to cashiers. The judge found that Wal-Mart has not demonstrated that its employees have any specific training regarding credit card transactions based on whether the purchase was made using a Discover, Master Card, Visa or American Express card.

The lead plaintiffs, Amy Fraser and Paula Haug, are represented by James M. Lindsay of Lindsay Law Corp.

The Wal-Mart ZIP Code Class Action Lawsuit is Amy Fraser, et al. v. Wal-Mart Stores Inc., Case No. 2:13-cv-00520, in the U.S. District Court for the Eastern District of California.

UPDATE: On June 21, 2016, Walmart says a recent Supreme Court decision should put an end to an ongoing class action lawsuit over the retailer’s collection of customers’ ZIP codes.

UPDATE 2: On Oct. 24, 2016, a federal court judge denied Walmart’s motion to decertify a class action lawsuit claiming the retail giant illegally collects ZIP codes from shoppers paying with credit cards, an alleged violation of the Song-Beverly Credit Card Act.