• BREAKING NEWS ABC shows live and on-demand -- Download the WATCH ABC app!

Retail chains sued for asking for zip codes

February 15, 2011 12:00:00 AM PST
More than a dozen national retail chains are facing lawsuits on Tuesday for asking customers for their zip codes when they use credit cards.

The state Supreme Court ruled that it's illegal for clerks to ask for zip codes because they are part of a customer's address. A state consumer privacy law forbids stores from requesting that information during credit card transactions.

Macy's, Target, Wal-Mart, Williams-Sonoma, and Cost Plus are all being sued for asking for customers' zip codes.

Attorney Mike Burns, who represents Michaels Stores Inc. in a ZIP code case, said it's difficult to assess how much each lawsuit could cost each company. State law calls for maximum fines of $250 for the first violation and $1,000 for each additional one, exposing each company to millions of dollars of liability.

But state Supreme Court Justice Carlos Moreno made clear in the ruling he wrote for the court last week that judges are free to award token fines for any violations.

Burns said he expects the retailers to defend themselves by arguing that clerks' requests are voluntary and consumers are free to refuse to divulge that and other personal information while paying by credit card.

The Associated Press contributed to this story.