Container Store ZIP Code Class Action Reaches Settlement

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The plaintiffs in The Container Store class action lawsuit, alleging that the retailer illegally asked for customers to disclose their ZIP codes during credit card purchases, want a Massachusetts federal judge to grant final approval to the class action settlement, saying that it is both fair and reasonable.

Plaintiff and class representative Judith Monteferrante said in the motion that both the class members and The Container Store agreed to settle the alleged violation of Massachusetts privacy laws to avoid potentially lengthy and costly litigation. However, The Container Store does not admit any wrongdoing.

The Class Members in The Container Store class action lawsuit will receive a $10.00 gift card that can be used at The Container Store in Massachusetts, if they submit a valid and timely claim, for a total of $877,000 based on the size of the Class. Monteferrante will receive $3,000 as class representative, and the plaintiffs’ attorneys will receive $120,000.

“The settlement value of $877,000 reflects, among other things, the evidence developed against defendant and, at the same time, recognizes the inherent risks, costs and potential for delay associated with complex class action litigation,” Monteferrante said.

The deadline for The Container Store class members to file a claim is Feb. 12, and 1,627 claims had been filed by Jan. 12.

In addition to the $10.00 gift card, The Container Store also agreed in the class action settlement to that it “will also comply with [Massachusetts state law] by agreeing that The Container Store will not request or record a credit card holder’s personal identification information during a credit card transaction unless for a proper purpose within the meaning of [Massachusetts] state law or any other relevant law.”

On April 15, 2013 Monteferrante sent a letter to The Container Store notifying the retailer that she wanted relief for the alleged privacy violation or she would be filing a class action lawsuit. However, The Container Store did not make a “reasonable offer,” and Monteferrante filed The Container Store ZIP code class action lawsuit on June 6, 2013, alleging that the retailer’s collection of ZIP codes from customers using credit cards at its Massachusetts locations is in violation of Massachusetts law.

“The Complaint alleges that The Container Store employees do not ask customers for their ZIP codes because the credit card companies require that they do so, nor do The Container Store employees request ZIP codes for verification purposes,” the class action settlement motion explains.

“Rather, the Complaint alleges that The Container Store uses a customer’s ZIP code and name to identify that customer’s address using commercially available databases,” which The Container Store can then use “for intrusive marketing purposes, which include The Container Store’s own direct marketing, such as sending marketing mail directly to consumers’ homes allegedly without their permission,” it adds.

The Container Store does not believe that the allegations in the ZIP code class action lawsuit have merit. However, after considering the pros and cons of litigation, both parties agreed to this settlement.

The court granted preliminary approval to The Container Store class action settlement on Sept. 15, 2014.

The class includes anyone living in Massachusetts who made a purchase at The Container Store from June 6, 2009 to the “date of the entry of the Preliminary Approval Order, used a credit card . . . and whose Personal Identification Information, including, but not limited to ZIP code, was requested and recorded by The Container Store, Inc. during the credit card transaction.”

Monteferrante is represented by Greg Blankinship and Todd S. Garber of Finkelstein Blankinship Frei-Pearson & Garber LLP and Joseph J. Siprut of Siprut PC.

The Container Store is represented by Tyler Baker and Craig Cardon of Sheppard Mullin Richter & Hampton LLP,and Creighton K. Page and Nicholas C. Theodorou of Foley Hoag LLP.

The Container Store ZIP Code Class Action Lawsuit is Monteferrante v. The Container Store Inc., Case No. 1:13-cv-11362  in the U.S. District Court for the U.S. District Court of Massachusetts.