Apple Inc. v. Superior Court of L.A. Cnty.
| Decision Date | 04 February 2013 |
| Docket Number | No. S199384.,S199384. |
| Citation | 56 Cal.4th 128,151 Cal.Rptr.3d 841,292 P.3d 883 |
| Court | California Supreme Court |
| Parties | APPLE INC., Petitioner, v. The SUPERIOR COURT of Los Angeles County, Respondent; David Krescent, Real Party in Interest. |
OPINION TEXT STARTS HERE
Gibson, Dunn & Crutcher, Daniel M. Kolkey, San Francisco, S. Ashlie Beringer, Palo Alto, Austin V. Schwing, San Francisco, Timothy W. Loose, Los Angeles, and Molly Cutler, Palo Alto, for Petitioner.
Willenken Wilson Loh & Delgado, Los Angeles, William A. Delgado and Eileen M. Ahern for Ticketmaster LLC as Amicus Curiae on behalf of Petitioner.
Drinker Biddle & Reath, Los Angeles, Sheldon Eisenberg and Kristopher Davis for eHarmony, Inc., as Amicus Curiae on behalf of Petitioner.
Sidley Austin, Los Angeles, Mark E. Haddad, David R. Carpetner; Paul Hastings, San Francisco, Thomas P. Brown and Kristin M. Hall for eBay, Inc., Walmart.com USA, LLC, California Retailers Association and NetChoice as Amici Curiae on behalf of Petitioner.
No appearance for Respondent.
Schreiber & Schreiber, Encino, Edwin C. Schreiber and Eric A. Schreiber for Real Party in Interest.
The Song–Beverly Credit Card Act of 1971 (Credit Card Act) governs the issuance and use of credit cards. (Civ.Code, § 1747 et seq.; all further statutory references are to the Civil Code unless otherwise indicated.) One of its provisions, section 1747.08, prohibits retailers from “[r]equest[ing], or requir[ing] as a condition to accepting the credit card as payment ..., the cardholder to write any personal identification information upon the credit card transaction form or otherwise.” (§ 1747.08, subd. (a) (hereafter section 1747.08(a)).) It also prohibits retailers from requesting or requiring the cardholder “to provide personal identification information, which the [retailer] ... writes, causes to be written, or otherwise records upon the credit card transaction form or otherwise,” and from “[u]tiliz[ing] ... a credit card form which contains preprinted spaces specifically designed for filling in any personal identification information of the cardholder.” ( Ibid.) In Pineda v. Williams–Sonoma Stores, Inc. (2011) 51 Cal.4th 524, 120 Cal.Rptr.3d 531, 246 P.3d 612( Pineda ), we considered whether section 1747.08 is violated when a retailer requests and records a customer's ZIP code during a credit card transaction. Relying on the statute's language, legislative history, and purpose, we concluded that a ZIP code constitutes “personal identification information” within the meaning of the statute and that the Credit Card Act forbids a retailer from requesting or recording such information. ( Pineda, at pp. 527–528, 120 Cal.Rptr.3d 531, 246 P.3d 612.)
Like Pineda, this case involves an asserted violation of section 1747.08. David Krescent, the plaintiff in this case, alleged in his complaint that defendant Apple Inc. requested or required him to provide his address and telephone number as a condition of accepting his credit card as payment. However, unlike Pineda, which concerned the purchase of a physical product at a traditional “brick-and-mortar” business, this case concerns the purchase of an electronic download via the Internet. We must resolve whether section 1747.08 prohibits an online retailer from requesting or requiring personal identification information from a customer as a condition to accepting a credit card as payment for an electronically downloadable product. Upon careful consideration of the statute's text, structure, and purpose, we hold that section 1747.08 does not apply to online purchases in which the product is downloaded electronically.
Our dissenting colleagues warn that today's decision “relegate[s] to the dust heap” the “ ‘robust’ consumer protection ... at the heart of section 1747.08” (dis. opn. by Kennard, J., post, 151 Cal.Rptr.3d at p. 860, 292 P.3d at p. 899) and represents a “major loss for consumers” ( id. at p. 857, 292 P.3d at p. 896) that “leaves online retailers free to collect and use the personal identification information of credit card users as they wish” (dis. opn. by Baxter, J., post,at p. 862, 292 P.3d at p. 900). These ominous assertions, though eye-catching, do not withstand scrutiny. As we explain, existing state and federal laws provide consumers with a degree of protection against unwanted use or disclosure of personal identification information. The Legislature may believe these measures are inadequate and, if so, may enact additional protections. Or the Legislature may believe that existing laws, together with market forces reflecting consumer preferences, are sufficient. It is not our role to opine on this important policy issue. We merely hold that section 1747.08 does not govern online purchases of electronically downloadable products because this type of transaction does not fit within the statutory scheme.
Because this case comes to us following summary denial of a writ of mandate after the denial of a demurrer, we assume as true all facts alleged in the operative complaint. ( Sheehan v. San Francisco 49ers, Ltd. (2009) 45 Cal.4th 992, 996, 89 Cal.Rptr.3d 594, 201 P.3d 472.) Petitioner Apple Inc. (Apple), defendant below, operates an Internet Web site and an online iTunes store through which it sells digital media such as downloadable audio and video files. In June 2011, plaintiff below, David Krescent, sued Apple on behalf of himself and a putative class of similarly situated individuals for alleged violations of section 1747.08. Specifically, Krescent alleged that he purchased media downloads from Apple on various occasions and that, as a condition of receiving these downloads, he was required to provide his telephone number and address in order to complete his credit card purchase. He further alleged that Apple records each customer's personal information, is not contractually or legally obligated to collect a customer's telephone number or address in order to complete the credit card transaction, and does not require a customer's telephone number or address for any special purpose incidental but related to the individual credit card transaction, such as shipping or delivery. Although he alleged that “the credit card transaction would be permitted to proceed” without any personal identification information, Krescent also contended that “even if the credit card processing company or companies required a valid billing address and [credit card identification number], under no circumstance would [plaintiff's] telephone number be required to complete his transaction, that is, under no circumstance does [Apple] need [plaintiff's] phone number in order to complete a [media] download transaction.”
In September 2011, Apple filed a demurrer, arguing that the Credit Card Act does not apply to online transactions and that deciding otherwise would undermine the prevention of identity theft and fraud. After a hearing, the trial court overruled the demurrer. The court noted that “the Act itself is silent on exempting online credit card transactions from its purview (and otherwise does not address online credit card transactions specifically).” While acknowledging that Apple's “assertions with respect to preventing fraud have definite appeal (a problem which the Court acknowledges is widespread in credit transactions generally, and in online credit card transactions specifically),” the trial court said it “is not prepared, at the pleading stage, to read the [Credit Card] Act as completely exempting online credit transactions from its reach.” The court also found, pursuant to Code of Civil Procedure section 166.1, that appellate resolution of the issue might materially assist the resolution of the litigation.
Apple filed a petition for writ of mandate seeking review of the trial court's order, which the Court of Appeal summarily denied. We granted Apple's petition for review and ordered the trial court to show cause why the relief sought in the petition for writ of mandate should not be granted.
We review de novo questions of statutory construction. In doing so, “ ‘our fundamental task is to “ascertain the intent of the lawmakers so as to effectuate the purpose of the statute.” ’ ” ( Mays v. City of Los Angeles (2008) 43 Cal.4th 313, 321, 74 Cal.Rptr.3d 891, 180 P.3d 935.) As always, we start with the language of the statute, “giv[ing] the words their usual and ordinary meaning [citation], while construing them in light of the statute as a whole and the statute's purpose [citation].” ( Pineda, supra, 51 Cal.4th at pp. 529–530, 120 Cal.Rptr.3d 531, 246 P.3d 612.)
We begin with the text of the statute. Section 1747.08(a) provides: Section 1747.08, subdivision (b) (hereafter section 1747.08(b)) defines “ ‘personal identification information’ ” as “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.”
The prohibitions codified in section 1747.08(a) are subject...
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Apple Inc. v. Superior Court of L.A. Cnty.
...56 Cal.4th 128292 P.3d 883151 Cal.Rptr.3d 841APPLE INC., Petitioner,v.The SUPERIOR COURT of Los Angeles County, Respondent;David Krescent, Real Party in Interest.No. S199384.Supreme Court of CaliforniaFeb. 4, [151 Cal.Rptr.3d 842]Gibson, Dunn & Crutcher, Daniel M. Kolkey, San Francisco, S. ......