A decades-old California law is at the center of a burgeoning series of privacy lawsuits that have significant implications for online retailers. The Song-Beverly Credit Card Act, enacted in 1971, originally aimed to limit the collection of personal information during in-person credit card transactions unless necessary for processing. However, this statute is now being leveraged in a new wave of litigation that questions its application to online transactions.
Retail giants such as Patagonia Inc. and Macy’s Inc. face more than a dozen lawsuits filed since April, alleging violations of the law by collecting data, including IP addresses, when processing online credit card transactions. These lawsuits argue that the data collection practices of these companies exceed what is required for transaction processing and therefore violate the statutory protections originally intended for physical store environments.
The outcome of these cases could reshape operational norms in the e-commerce sector, pushing companies to reevaluate their data collection practices to ensure compliance with consumer privacy laws originally designed for a pre-digital age.
For further details on these lawsuits and the full implications of the Song-Beverly Credit Card Act on online retail practices, visit the Bloomberg Law article.