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Reid Yeoman and Rita Medellin, On Behalf of Themselves and All Others Similarly Situated v. Ikea U.S. West

May 4, 2012


The opinion of the court was delivered by: Hayes, Judge:


The matter before the Court is the Motion for Class Certification filed by Plaintiff Rita Medellin. (ECF No. 30).

I. Background

On March 2, 2011, Plaintiff Reid Yeoman initiated this action by filing a Complaint in the Superior Court of California for the County of San Diego. The Complaint contained one claim for violation of the Song-Beverly Credit Card Act of 1971. On April 6, 2011, the matter was removed to this Court by Defendant Ikea U.S. West, Inc. ("Ikea").

On November 8, 2011, Plaintiff filed an Amended Complaint which added Plaintiff Rita Medellin. Plaintiffs allege that they purchased items from Ikea using their credit cards. Plaintiffs allege that "[d]uring the credit card transaction[s], the cashier asked plaintiff[s] for [their] ZIP code and, believing [they were] required to provide the requested information to complete the transactions, [plaintiffs] provided it." (ECF No. 25 at 3). Plaintiffs allege that "Ikea systematically and intentionally violates the [Song-Beverly Credit Card Act of 1971] by uniformly requesting that cardholders provide personal identification information, including their ZIP codes, during credit card transactions, and then recording that information in electronic database systems." Id. at 2.

On January 13, 2012, Plaintiff Medellin filed a Motion for Class Certification.

II. Standard of Review

"As the party seeking class certification, [plaintiff] bears the burden of demonstrating that she has met each of the four requirements of Rule 23(a) and at least one of the requirements of Rule 23(b)." Zinser v. Accufix Research Inst., 253 F.3d 1180, 1186 (9th Cir. 2001) (citing Hanon v. Dataproducts Corp., 976 F.2d 497, 508 (9th Cir. 1992)); see also Dukes v. Wal-Mart Stores, Inc., 603 F.3d 571, 591 (9th Cir. 2010) ("[W]hether the suit is appropriate for class resolution must be actually demonstrated, not just alleged, to the district court's satisfaction."). The four requirements of Rule 23(a) are: "(1) numerosity (a class [so large] that joinder of all members is impracticable); (2) commonality (questions of law or fact common to class); (3) typicality (named parties claims or defenses are typical ... of the class); and (4) adequacy of representation (representatives will fairly and adequately protect the interests of the class)." Mego Fin. Corp. Sec. Litig. v. Nadler, 213 F.3d 454, 462 (9th Cir. 2000) (internal quotations omitted). Federal Rule of Civil Procedure 23(b) provides that a class action may be maintained if: (1) "prosecuting separate actions by or against individual class members would create a risk of ... inconsistent or varying adjudications ... or adjudications ... that, as a practical matter, would be dispositive of the interests of the other members not parties ... or would substantially impair or impede their ability to protect their interests"; (2) "the party opposing the class has acted or refused to act on grounds that apply generally to the class so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole"; or (3) "the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." See Fed. R. Civ. P. 23(b)(1)-(3).

In analyzing whether a plaintiff has met her burden to show that the above requirements are satisfied, a court must "analyze[] the allegations of the complaint and the other material before [the court] (material sufficient to form reasonable judgment on each [Rule 23] requirement)." Blackie v. Barrack, 524 F.2d 891, 900-01 (9th Cir. 1975) (noting that a court is to take the substantive allegations in the complaint as true); see also Hanon, 976 F.2d at 509; Sepulveda v. Wal-Mart Stores, Inc., 237 F.R.D. 229, 233 (C.D. Cal. 2006). "The Court is at liberty to consider evidence which goes to the requirements of Rule 23 even though the evidence may also relate to the underlying merits of the case." In re Unioil Secs. Litig., 107 F.R.D. 615, 618 (C.D. Cal. 1985). However, a court should not judge the merits of the plaintiff's claims at the class certification stage. See United Steel, Paper & Forestry, Rubber, Mfg. Energy, Allied Indus. v. ConocoPhillips Co., 593 F.3d 802, 808 (9th Cir. 2010); Valentino v. Carter-Wallace, Inc., 97 F.3d 1227, 1232 (9th Cir. 1996); see also Coopers & Lybrand v. Livesay, 437 U.S. 463, 469 (1978).

III. Discussion

Plaintiff seeks class certification for the following class:

[A]ll persons from whom Ikea requested and recorded a ZIP Code in conjunction with a credit card transaction in California from February 16, 2010 through the date of trial in this action (the "Class"). Excluded from the Class are (i) transactions wherein personal information was required for a special purpose incidental but related to the individual credit card transaction, including, but not limited to, information relating to shipping, delivery, servicing, or installation of the purchased merchandise, or for special orders; and (ii) transactions wherein a credit card issued to a business was used. Also excluded from the Class are the officers and directors of Defendant and of its corporate parents, subsidiaries and affiliates, or any entity in which Defendant has a controlling interest, and the legal representatives, successors or assigns of any such excluded persons or entities, and the Court to which the matter is assigned. (ECF No. 33 at 5).*fn1

Defendant contends that the proposed class is overbroad because it would include individuals who voluntarily provided their personal information to Ikea through alternative means including participating in the Ikea Family reward program, enrolling for email or postal mail through, completing in-store promotional forms, or requesting direct mailing or catalogs. Defendant contends that the Song-Beverly Credit Card Act addresses "one important privacy concern: to prevent corporations from needlessly storing consumer information for use in direct-mail marketing campaigns or selling the information to other marketers for an identical purpose." (ECF No. 40 at 4) (emphasis added). Defendant contends that "allowing persons who have volunteered personal identification information to thereafter assert a claim for a violation of the Act, predicated on that person's privacy interests, is in direct contravention to the purpose of the Act and would be entirely illogical." Id.

Plaintiff contends that "the protections afforded by [the Song-Beverly Credit Card Act] cannot be waived by a customer voluntarily providing [personal identification information] during unrelated circumstances separate from a credit card transaction." (ECF No. 33 at 2). Plaintiff contends that the Song-Beverly Credit Card Act "does not state that if a customer ever engaged in one of the enumerated exempted transactions, or provided [personal identification information] to the Defendant at another time separate from the credit card transaction, the customer is forever banned from making a claim ...." Id. at 4.

The Song-Beverly Credit Card Act provides:

[N]o person, firm, partnership, association, or corporation that accepts credit cards for the transaction of business shall do any of the following: ...

Request, or require as a condition to accepting the credit card as payment in full or in part for goods or services, the cardholder to provide personal identification information, which the person, firm, partnership, association, or corporation accepting the credit card writes, causes to be written, or otherwise records upon the credit card transaction form or otherwise....

For purposes of this section "personal identification information," means information concerning the cardholder, other than information set forth on the credit card, and including, but not limited to, the cardholder's address and telephone number.

Cal. Civ. Code § 1747.08. "[A] cardholder's ZIP code, without more, constitutes personal identification information within the meaning of section 1747.08." Pineda v. Williams-Sonoma Stores, Inc., 51 Cal. 4th 524, 530 (Cal. 2011) (holding that the court's ruling that ZIP code information constitutes personal information within the meaning of section 1747.08 applies retrospectively).

The Song-Beverly Credit Card Act was "a response to two principal privacy concerns. [F]irst, that with increased use of computer technology, very specific and personal information about a consumer's spending habits was being made available to anyone willing to pay for it; and second, that acts of harassment and violence were being committed by store clerks who obtained customers' phone numbers and addresses." Florez v. Linens 'N Things, Inc., 108 Cal. App. 4th 447, 452 (2003) (quotation omitted); see also Gass v. Best Buy Co., Inc., Case No. CV 11--01507 SJO (JCGx), 2012 WL 538251 at *2 (C.D. Cal. Feb. 13, 2012) (same); Rothman v. General Nutrition Corp., Case No. CV 11--03617 SJO (RZx), 2011 WL 6940490 at *2 (C.D. Cal. Nov. 17, 2011) (same).

However, "nothing in the [Song-Beverly Credit Card] Act prohibits corporations from obtaining personal information from consumers who provide their information voluntarily." Rothman, 2011 WL 6940490 at *2 (citing Florez, 108 Cal. App. 4th at 451). In Rothman, the district court denied certification of a class, in part, because the class definition included individuals who voluntarily provided personal information to the retailer at the time of the credit card transaction by presenting a "Gold Card" customer loyalty card which contained their personal identification information. Rothman, 2011 WL 6940490 at *3.

The Song-Beverly Credit Card Act does not provide an exception allowing a retailer to request or require the cardholder to provide personal identification information as a condition of accepting a credit card payment when the individual has previously or subsequently provided any personal information to the retailer. Such an exception would contravene one of the purposes of the Song-Beverly Credit Card Act which is to prevent store clerks from obtaining customers' personal identification information. The Court concludes that Class definition is not overbroad on the grounds that it may include individuals who voluntarily provided their personal identification information to Ikea at some time other than in conjunction with the credit card transaction during which Ikea requested and recorded the individuals' ZIP code information.

With regard to the Ikea Family reward program, Defendant has submitted the declaration of John Robinson who stated: "Within one month of the ruling in the matter of Pineda v. Williams-Sonoma Stores, Inc., et al., Ikea completely suspended ZIP Code requests by its in-store cashiers in all retail locations, including California retail locations." (ECF No. 31-2 at 2). Pineda was issued on February 10, 2011. Robinson stated in his deposition taken on December 21, 2011: "We're just starting in the last few months an Ikea loyalty program." (ECF No. 33-1 at 6). Robinson stated in his declaration dated January 30, 2012, that "Ikea currently has a rewards program, the IKEA Family Program, which customers can volunteer to enroll in by providing their name, address, ZIP Code, telephone number, and often times, electronic mail addresses." (ECF No. 31-2 at 2). According to Defendant, Ikea stopped its practice of requesting ZIP code information from customers using credit cards in approximately March 2011, but the Ikea Family reward program did not begin until shortly before December 2011. Defendant has failed to show that the Class may be comprised of individuals who voluntarily submitted their personal identification information along with a credit card transaction because the Ikea Family reward program began after Ikea ceased collecting ZIP code information along ...

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