Judge John F. Walter of the U.S. District Court for the Central District of California recently refused to certify a nationwide class of consumers in Spikings v. Cost Plus, Inc.  Cost Plus is represented by Marcy Bergman, Robert Padway, Merrit Jones and Leila Knox of Cooper, White & Cooper LLP.

Plaintiff alleged in the lawsuit that Cost Plus willfully violated a provision of the Fair and Accurate Credit Transactions Act (“FACTA”), effective December 4, 2006.  FACTA prohibits retailers from printing more than the last five digits of a credit or debit card number and the expiration date on customer receipts, and provides for statutory penalties of $100 to $1000 per credit or debit card transaction for “willful” violations.  

The plaintiff sought to recover statutory penalties of $100 to $1,000 per transaction for alleged “willful” violations of FACTA, and sought to have the lawsuit certified as a class action.  Judge Walter found that the requirements for class certification were not met because:

  • Liability for statutory damages would be enormous and completely out of proportion to any harm suffered by the plaintiff or any member of the proposed class.
  • It appeared unlikely, if not impossible, for such inclusion of an expiration date with the last five digits of a credit or debit card number to result in identity theft or other actual harm. 
  • Cost Plus took immediate steps to remedy the violation once it became aware of the law.  

More than 200 retailers, including Cost Plus, have been sued under this provision of FACTA.  Since Judge Walter’s decision, class certification has been denied in three other FACTA cases. 

If not already in compliance with FACTA, companies that accept credit and debit card payments should act immediately.  Under FACTA, any receipt given to a customer in a credit or debit card transaction must not show more than the last five digits of the card number and must not include the expiration date of the card.  Prompt steps to comply with FACTA will aid in minimizing exposure to potential lawsuits for statutory FACTA penalties.     

Spikings v. Cost Plus, Inc., is case no. CV 06-8125 JFW (AJWx) (C.D. Cal. 2006).