Dave & Buster’s Hit With Gift Card Class Action Lawsuit

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The restaurant and arcade entertainment company Dave & Buster’s was hit with a proposed class action lawsuit on Tuesday for allegedly violating California’s gift card law that requires businesses to give cash back on gift cards with a balance of less than $10.

Lead plaintiff Jason Skinner filed the Dave & Buster’s class action lawsuit after his experience at a California restaurant location. Skinner alleges that he used a D&B gift card to pay for items but there was nothing else he wanted so he asked a food server if he could redeem the balance of his card, which was less than $10, for cash. The Dave & Buster’s employee informed Skinner that the balance would have to remain on the card for “future” use at the establishment.

Between the food server’s response and the wording on the actual D&B gift card which states “user will not be issued any cash back,” plaintiff Skinner believed that he could not redeem the low value gift card for cash and therefore the card was worthless.

Prior to filing the proposed gift card class action lawsuit, Skinner set up a lawsuit investigation to determine if this was just an isolated incident by a certain Dave & Buster’s employee or an overall failure to comply with the state law. The investigation allegedly revealed that restaurant employees consistently refused to honor requests for cash back on gift cards less than $10.

The Dave & Buster’s gift card class action lawsuit claims this denial is a direct violation of the state Senate Bill 250 which was enacted in 2008 and requires businesses to honor any valid requests for cash back on gift cards less than $10.

Plaintiff Skinner further alleges that Dave & Buster’s is in violation unfair acts and practices which was an amendment to SB 250. The class action lawsuit states that the consumer either forfeits the remaining value of the card or they make an unnecessary purchase which would likely involve additional out-of-pocket costs. The lead plaintiff alleges this is considered an unfair practice.

The Dave & Buster’s class action lawsuit claims that the company will continue to engage in these unlawful and unfair practices unless an injunction is issued.

According to the proposed class action lawsuit, approximately $5 billion in gift cards go unspent every year. After a few years the retailer gets to claim the consumer’s one as profit without supplying a product or paying sales tax.

If the Dave & Buster’s class action lawsuit is approved it would be open to all California consumers who possess the defendant’s gift cards with a balance of less than $10 which were purchased during the class period and/or who possess a Dave & Buster’s gift card which contains the following term “the user will not be issued any cash back,” which was purchased during the class period. The proposed class period will be determined as four years prior to this filing until the date of Class certification.

The plaintiff is represented by Phillip R. Poliner of Fineman & Poliner LLP.

The Dave & Buster’s Gift Card Class Action Lawsuit is Skinner v. Dave & Buster’s Inc., Case No. BC590241, in the Superior Court for the State of California, County of Los Angeles.