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California court clears Apple in credit card privacy suit

post #1 of 32
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California's Supreme Court ruled on Monday that Apple did not violate the state's privacy laws by requiring that customers provide addresses and phone numbers to accept credit card payments.

Plaintiffs in the case, Reuters reports, had sued Apple and a number of other online retailers, all of which required customers to provide both addresses and phone numbers in order to complete credit card purchases. The plaintiffs ? who had purchased content from iTunes ? claimed that the requirement constituted a violation of California privacy laws, which prohibit retailers from unnecessarily gathering consumer information.

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In a split decision, the court ruled that those laws do not apply to online purchases that are downloaded electronically. The same court ruled in 2011 that those privacy protections do apply to physical retail locations, barring brick and mortar stores from requesting customers' ZIP codes during credit card purchases.

The three dissenting judges called the ruling a win for retailers but "a major loss for consumers, who in their online activities already face an ever-increasing encroachment upon their privacy."

The four judges of the majority said the plaintiff had raised "ominous assertions" about Apple encroaching on consumer privacy rights. Those assertions, "though eye-catching, do not withstand scrutiny," they wrote in the majority opinion.
post #2 of 32
Not the smartest bunch, these plaintiffs? I mean, this law can be looked up, no?
post #3 of 32
Seriously, if they are not asking for that info, they are not doing their job to protect the card owner.. that info is used to verify purchasers.. anyone can be using that card. Address and phone verification is one of the few checks they have..

With online purchases, It's not like they can ask for your ID if you didn't sign the back of the card.
post #4 of 32
REALLY? If you own a home - do you think the government has protected your name and address? Try going through Deeds or Tax lists in any State. The postman knows where you live - ever have a magazine delivered to your home? They share with affiliates. How about the pizza guy and Dominoes pizza or papa johns - They Know! There is also intelius.com and all sorts of apps and the biggest privacy offender - an old fashioned Telephone book. BEWARE!!!! they are coming for you!!
post #5 of 32
Quote:
Originally Posted by PhilBoogie View Post

Not the smartest bunch, these plaintiffs? I mean, this law can be looked up, no?

It was actually a pretty close decision. If just one of the 4 judges that ruled in Apple's favor had instead decided the opposite then Apple would have lost at the California SC The ruling was split 4-3.

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post #6 of 32

It's becoming clear that your privacy and rights to ownership are ever increasingly being taken away.

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post #7 of 32
i bet these plaintiffs post their personal info in facebook and allow it to be public.
post #8 of 32

Those plaintiffs sound like a bunch of morons and I'm glad that they lost.

 

It seems like plain common sense that addresses and phone numbers are connected to a particular card, and I would be suspicious of any site or retailer that didn't require them. Not having that requirement seems like heaven for fraudsters and criminals, and there are plenty of those around. If somebody doesn't wish to give up their address or phone number while doing a card transaction, then they have no business purchasing anything online from anybody.

post #9 of 32

If one does not want to 'reveal personal info, go buy from someone else who does not request it.  Good luck.

Someone, preferably Tim Cook, please explain why Apple did not advertise in the Superbowl (largest viewing audience anytime anywhere for any TV event).  Could they not come up with something appealing ? ( i am a long time shareholder of AAPL, who is disillusioned by their 'failing stock price.)

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post #10 of 32
Quote:
Originally Posted by Gatorguy View Post

It was actually a pretty close decision. If just one of the 4 judges that ruled in Apple's favor had instead decided the opposite then Apple would have lost at the California SC The ruling was split 4-3.

 

Thanks for doing that math for us. Of course, if just one of the Judges who were against Apple's position, which was following industry standard identity verification procedures, had decided the opposite, the ruling would have been 5-2. It's fun to play, if only things had been different, isn't it?

post #11 of 32
Quote:
Originally Posted by PhilBoogie View Post

Not the smartest bunch, these plaintiffs? I mean, this law can be looked up, no?

 

 

You are assuming that the laws are drafted by the smartest bunch and don't have more than one possible interpretation. 

post #12 of 32
Quote:
Originally Posted by tylerk36 View Post

It's becoming clear that your privacy and rights to ownership are ever increasingly being taken away.

As others have mentioned if you have a magazine subscription or order a pizza you have basically waived your right to privacy. If you are really concerned about it, you could start an anonymous corporation and buy/own everything through the corporation because you own 100% of the shares. Kind of a hassle and costs money but it does prevent retailers from collecting your personal data. Of course it doesn't stop government agencies.

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post #13 of 32

If someone is worried about privacy, they shouldn't be doing anything online. I applaud the decision. Online retailers need to ask for your billing address to prevent fraudulent use of a credit card. I for one am happy they ask. Imagine if the decision went the other way and all you needed was the credit card number to make an online purchase? That would open the door to rampant identity theft. 

post #14 of 32
Quote:
Originally Posted by tylerk36 View Post

It's becoming clear that your privacy and rights to ownership are ever increasingly being taken away.

Please be realistic. What you're expecting in this case basically decimates any ability to validate that the purchaser is the rightful holder of the card. At a B&M, they can ask to see your ID and see that the name on the ID matches the name on the card. Online, that just isn't possible.
post #15 of 32
Quote:
Originally Posted by JeffDM View Post


Please be realistic. What you're expecting in this case basically decimates any ability to validate that the purchaser is the rightful holder of the card. At a B&M, they can ask to see your ID and see that the name on the ID matches the name on the card. Online, that just isn't possible.

 

Yes, they can ask to see your id at a store, however most credit cards like Mastercard and Visa have merchant agreements that say that a store cannot refuse a transaction if you won't show your identification.

 

At least that's their official policy.  For example:

 

Mastercard:   "A merchant must not refuse to complete a transaction solely because a cardholder refuses to provide additional identification information.

 

However, there are certain situations where a merchant may require some personal information, such as a shipping address for online purchases.

 

Additionally, if your MasterCard card is unsigned, a merchant should request personal identification to confirm your identify and ask the cardholder to sign the card before completing the transaction.

 

If you believe that a merchant has violated the above standard or their actions requesting identification are questionable, you may report it by clicking the following URL and completing a brief online form."

 

Good luck on getting a store to follow all the rules, though.

post #16 of 32
Quote:
Originally Posted by PhilBoogie View Post

Not the smartest bunch, these plaintiffs? I mean, this law can be looked up, no?

Did it never occur to you that some laws are ambiguous and need a court's interpretation? The very fact that the decision was 4-3 indicates that it was not clear cut.

I haven't read it, but reading between the lines, it probably says something like "the retailer can collect information needed to ensure that the person making the purchase is the legitimate card holder". There is a difference of opinion on what is required.
Quote:
Originally Posted by Zomp View Post

REALLY? If you own a home - do you think the government has protected your name and address? Try going through Deeds or Tax lists in any State. The postman knows where you live - ever have a magazine delivered to your home? They share with affiliates. How about the pizza guy and Dominoes pizza or papa johns - They Know! There is also intelius.com and all sorts of apps and the biggest privacy offender - an old fashioned Telephone book. BEWARE!!!! they are coming for you!!

The fact that some things are public does not negate the rights of people to no have unnecessary intrusions on their privacy. For example, the fact that you've ordered a pizza does not mean that you want the entire world to know that you were shopping for adult toys, for example.
Quote:
Originally Posted by Earthist View Post

If one does not want to 'reveal personal info, go buy from someone else who does not request it.  Good luck.
Someone, preferably Tim Cook, please explain why Apple did not advertise in the Superbowl (largest viewing audience anytime anywhere for any TV event).  Could they not come up with something appealing ? ( i am a long time shareholder of AAPL, who is disillusioned by their 'failing stock price.)

Apple obviously didn't advertise because they didn't think it was worth $4 M for 30 seconds of time.
Quote:
Originally Posted by JeffDM View Post

Please be realistic. What you're expecting in this case basically decimates any ability to validate that the purchaser is the rightful holder of the card. At a B&M, they can ask to see your ID and see that the name on the ID matches the name on the card. Online, that just isn't possible.

It's not that simple, either. A credit card company will normally approve the purchase if you have the card number and the 3 (or 4) digit security code on the card. Sometimes they require the zip code, too. The credit card company normally does NOT require a full address, so I don't think that argument is very convincing.

All we know is that whatever argument Apple used, it convinced a majority of the judges that it was not a violation of privacy.
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post #17 of 32
Quote:
Originally Posted by Adrayven View Post

Seriously, if they are not asking for that info, they are not doing their job to protect the card owner.. that info is used to verify purchasers.. anyone can be using that card. Address and phone verification is one of the few checks they have..

With online purchases, It's not like they can ask for your ID if you didn't sign the back of the card.


It is seriously naive to think that collecting the address and telefone numbers will contribute significantly to security. One really shouldn't be so amazingly naive. Seriously !

post #18 of 32
Originally Posted by Apple ][ View Post
Those plaintiffs sound like a bunch of morons and I'm glad that they lost.

 

It seems like plain common sense that addresses and phone numbers are connected to a particular card, and I would be suspicious of any site or retailer that didn't require them. Not having that requirement seems like heaven for fraudsters and criminals, and there are plenty of those around. If somebody doesn't wish to give up their address or phone number while doing a card transaction, then they have no business purchasing anything online from anybody.


Among the long and growing list of things you don't have a clue about, you can add security and privacy.

post #19 of 32
Quote:
Originally Posted by Taniwha View Post


Among the long and growing list of things you don't have a clue about, you can add security and privacy.

 

Were you one of the moronic plaintiffs or something?, because you certainly sound butthurt.lol.gif

 

Since addresses and phone numbers don't matter, why don't you just hand over your credit card number to me (if you qualified for one) in your reply, without giving me the address or phone number and I'll make good use of it.

 

And listen up genius, addresses are important for credit cards, not just because of security reasons, but because it also tells you what country the card was issued in, and many retailers have restrictions on where they will sell to or ship to. There's a reason why Apple has different iTunes stores for each country.

post #20 of 32
Quote:
Originally Posted by Earthist View Post

If one does not want to 'reveal personal info, go buy from someone else who does not request it.  Good luck.

Someone, preferably Tim Cook, please explain why Apple did not advertise in the Superbowl (largest viewing audience anytime anywhere for any TV event).  Could they not come up with something appealing ? ( i am a long time shareholder of AAPL, who is disillusioned by their 'failing stock price.)

The only ad that could have made an immediate difference on share price would have been the unveiling of some awesome new product.

 

Samsung, on the other hand, still has a long way to go before their brand name evokes warm, fuzzy feelings with American consumers, so they invested a big chunk of change being cutesy with some actors who are relevant to twenty-somethings.  Apple doesn't need to invest in that type of advertising any more because pretty much everyone already has an opinion about Apple by now.  (Unless you want Apple doing an ad like Ram did with their cringe-inducing marathon poem about farmers.)

post #21 of 32
Quote:
Originally Posted by malax View Post

The only ad that could have made an immediate difference on share price would have been the unveiling of some awesome new product.

Samsung, on the other hand, still has a long way to go before their brand name evokes warm, fuzzy feelings with American consumers, so they invested a big chunk of change being cutesy with some actors who are relevant to twenty-somethings.  Apple doesn't need to invest in that type of advertising any more because pretty much everyone already has an opinion about Apple by now.  (Unless you want Apple doing an ad like Ram did with their cringe-inducing marathon poem about farmers.)

And if Apple had done that, the same people would be complaining about Apple spending $16 M on a SuperBowl ad. I'm sure we'd have a dozen trolls saying "Apple should be innovating instead of spending money on expensive ads".
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post #22 of 32
Quote:
Originally Posted by jragosta View Post


And if Apple had done that, the same people would be complaining about Apple spending $16 M on a SuperBowl ad. I'm sure we'd have a dozen trolls saying "Apple should be innovating instead of spending money on expensive ads".

That's true. No matter what Apple does or how much they sell, there will always be a few idiots to come along and try to paint the story as something negative.

 

Apple should just do whatever is right, without worrying about what a few naysayers and morons might say or think. Exactly what right means is a slightly different topic of course.

post #23 of 32

Good decision.

 

Does anyone remember all the scams that go on with Apple to turn CC #'s into cash? Organized criminals set up goods for sale with Apple (crappy indie music or stupid Apps). They then run huge $$$ through Apple with purchases by fake customers using those CC #'s. Apple takes their 30% cut and you get a cheque from Apple for the other 70%. You've just turned stolen credit cards into cash and only took a 30% hit. If Apple no longer required address or phone numbers then this type of scam could skyrocket.

 

To the people whining about privacy - did you know Apple has gift cards? Easy way to buy stuff without ever having to provide a CC #.

 

As KD mentioned, a merchant cannot refuse if your card is valid and you fail to provide additional ID. Now imagine a merchant asking to see a drivers license for that $1,000 laptop you just bought. There are two kinds of people: those that will happily comply and be happy the store is being vigilant and those "freaks" who will sit there and argue for 20 minutes about their rights being violated. Apparently this is a more productive use of their time than the 15 seconds it would take to flash your license to the clerk. These are the people who probably sued.

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post #24 of 32
Quote:
Originally Posted by KDarling View Post

Yes, they can ask to see your id at a store, however most credit cards like Mastercard and Visa have merchant agreements that say that a store cannot refuse a transaction if you won't show your identification.

At least that's their official policy.  For example:

Mastercard:   "A merchant must not refuse to complete a transaction solely because a cardholder refuses to provide additional identification information.


However, there are certain situations where a merchant may require some personal information, such as a shipping address for online purchases.


Additionally, if your MasterCard card is unsigned, a merchant should request personal identification to confirm your identify and ask the cardholder to sign the card before completing the transaction.


If you believe that a merchant has violated the above standard or their actions requesting identification are questionable, you may report it by clicking the following URL and completing a brief online form."

Good luck on getting a store to follow all the rules, though.

Given the amount of credit card theft and fraud that goes on, how is a merchant supposed to protect themselves if they can't even require ID? In the B&M example, I'm not saying that they should be allowed to record the address, just ask to show proof that the purchaser is the valid user of the card. Add to that that the merchant is stuck with the loss if it turns out to be a fraudulent use of the card. The way the rules are written, it's as if the card issuers are deliberately setting up merchants for the fall with fraud. Thankfully, I haven't been hit with card fraud yet, but at least I sell a physical product, so I do get the address for an address verification check for some peace of mind.
Edited by JeffDM - 2/4/13 at 8:01pm
post #25 of 32
A
Quote:
Originally Posted by Earthist View Post

If one does not want to 'reveal personal info, go buy from someone else who does not request it.  Good luck.
Someone, preferably Tim Cook, please explain why Apple did not advertise in the Superbowl (largest viewing audience anytime anywhere for any TV event).  Could they not come up with something appealing ? ( i am a long time shareholder of AAPL, who is disillusioned by their 'failing stock price.)
Advertising would do nothing for the falling stock price. The stock is being manipulated by professional traders and as such does not reflect real value in the company. Why you would even whine about this is beyond me as it is pretty clear what is going on.
post #26 of 32
Quote:
Originally Posted by Apple ][ View Post

Quote:
Originally Posted by Taniwha View Post


Among the long and growing list of things you don't have a clue about, you can add security and privacy.

 

Were you one of the moronic plaintiffs or something?, because you certainly sound butthurt.lol.gif

 

Since addresses and phone numbers don't matter, why don't you just hand over your credit card number to me (if you qualified for one) in your reply, without giving me the address or phone number and I'll make good use of it.

 

And listen up genius, addresses are important for credit cards, not just because of security reasons, but because it also tells you what country the card was issued in, and many retailers have restrictions on where they will sell to or ship to. There's a reason why Apple has different iTunes stores for each country.


It's OK, you've proven n that you represent the low-water mark for internet intelligence. You don't have to keep on proving it. Move on and get a life.

post #27 of 32
Quote:
Originally Posted by JeffDM View Post


Given the amount of credit card theft and fraud that goes on, how is a merchant supposed to protect themselves if they can't even require ID? In the B&M example, I'm not saying that they should be allowed to record the address, just ask to show proof that the purchaser is the valid user of the card. Add to that that the merchant is stuck with the loss if it turns out to be a fraudulent use of the card. The way the rules are written, it's as if the card issuers are deliberately setting up merchants for the fall with fraud. Thankfully, I haven't been hit with card fraud yet, but at least I sell a physical product, so I do get the address for an address verification check for some peace of mind.

I got hit with a $1200+ chargeback last month, even doing everything right. The CC company gave me a choice of reversing the customer's charge, or holding all my other CC deposits until they could investigate our "unusual account activity". Not much of a choice.

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post #28 of 32
Quote:
Originally Posted by KDarling View Post

 

Yes, they can ask to see your id at a store, however most credit cards like Mastercard and Visa have merchant agreements that say that a store cannot refuse a transaction if you won't show your identification.

 

At least that's their official policy.  For example:

 

Mastercard:   "A merchant must not refuse to complete a transaction solely because a cardholder refuses to provide additional identification information.

 

That's not what it says, that they can't refuse it, only that that must not be the sole reason. So, you don't show your ID, the store believes that's suspicious behavior, refusing to show your ID, and you have two reasons right there.

post #29 of 32

Anyone who has read even a few of my posts knows that I'm a strong privacy advocate, but I think the premise behind this lawsuit is ridiculous. Yes, it would be great if we had an unforgeable, theft-proof, anonymous way to make payments, but, short of that, until widespread theft and fraud are abolished, this is a very minor, acceptable evil. 

post #30 of 32
Quote:
Originally Posted by JeffDM View Post

Given the amount of credit card theft and fraud that goes on, how is a merchant supposed to protect themselves if they can't even require ID? In the B&M example, I'm not saying that they should be allowed to record the address, just ask to show proof that the purchaser is the valid user of the card. Add to that that the merchant is stuck with the loss if it turns out to be a fraudulent use of the card. The way the rules are written, it's as if the card issuers are deliberately setting up merchants for the fall with fraud. Thankfully, I haven't been hit with card fraud yet, but at least I sell a physical product, so I do get the address for an address verification check for some peace of mind.

Technically, the card issuer is on the hook for fraud. As long as the retailer follows the issuer's rules, it is the issuer who should be paying for fraud. While they can make it difficult to collect (as in Gatorguy's example), it is ultimately the issuer's problem. Retailers need to be a little more careful in who they choose to be their credit card processor - and if that's not enough, lobby for their states to clarify whose responsibility it is.

Quote:
Originally Posted by anonymouse View Post

Anyone who has read even a few of my posts knows that I'm a strong privacy advocate, but I think the premise behind this lawsuit is ridiculous. Yes, it would be great if we had an unforgeable, theft-proof, anonymous way to make payments, but, short of that, until widespread theft and fraud are abolished, this is a very minor, acceptable evil. 

Whether it's an acceptable evil or not isn't the issue in this case. The issue is what the California law allows and requires. Apple met the requirements of the law - according to an appeals court in a close split decision. That suggests that the law is somewhat ambiguous. It also suggests that the people who either think that requiring more information from purchasers is reasonable OR the people who think it's unreasonable need to write their legislators. This will not be sorted out in the courts.
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post #31 of 32
Quote:
Originally Posted by PhilBoogie View Post

Not the smartest bunch, these plaintiffs? I mean, this law can be looked up, no?
Quote:
Originally Posted by Gatorguy View Post

It was actually a pretty close decision. If just one of the 4 judges that ruled in Apple's favor had instead decided the opposite then Apple would have lost at the California SC The ruling was split 4-3.

Quote:
Originally Posted by TBell View Post

You are assuming that the laws are drafted by the smartest bunch and don't have more than one possible interpretation. 

Quote:
Originally Posted by jragosta View Post

Did it never occur to you that some laws are ambiguous and need a court's interpretation? The very fact that the decision was 4-3 indicates that it was not clear cut.

Valid points - thanks gents.
post #32 of 32
Quote:
Originally Posted by jungmark View Post

i bet these plaintiffs post their personal info in facebook and allow it to be public.

Then there's this from Facebook: 

 

Facebook is developing a smartphone application that will track the location of users.. . who access the service via handheld devices. The app...would run even when the program isn’t open on a handset, said one of the people, who asked not to be identified because the plans aren’t public.

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