“Zip Code Cases”

“Zip Code Cases” and why they are important 

Numerous class actions have been filed against retailers concerning improper data collection during checkout. These so-called “zip code cases” raise important privacy issues, and we will continue to push ahead with them.  Throughout America and Massachusetts, businesses collect an unprecedented volume of data about consumers and sometimes they do so unlawfully. Over twenty years ago, the Massachusetts legislature wanted consumers to have privacy and security when they use credit cards, and therefore limited what information merchants can collect. The implications of excessive data collection are for more troubling in this new era of “big data.” Today, the average consumer has little to no understanding of how their personal information is collected, scrutinized, cross-referenced, and monetized.  According to a FTC report (pdf) issued in May, 2014 “data brokers collect consumer data from numerous sources, largely without consumers’ knowledge.” Information harvested by retailers during credit card transactions is digital gold to data brokers.

Collecting ZIP codes at checkout is generally illegal in Massachusetts

A large number of retailers  have violated and continue to violate Massachusetts law by collecting ZIP codes from consumers who pay by credit card. When retailers go to data brokers such as Acxiom, Datalogix, CoreLogic, Trillium, or Pitney Bowes,  they can learn their customers’ mailing addresses and inundate them with unwanted junk mail.

The “Massachusetts Consumer Privacy In Commercial Transactions Statute,” or “Section 105(a)”:

Section 105. (a) No person, firm, partnership, corporation or other business entity that accepts a credit card for a business transaction shall write, cause to be written or require that a credit card holder write personal identification information, not required by the credit card issuer, on the credit card transaction form.”

Most Retailers Have Denied the Practice

Denials have come from retailers who have been observed asking for ZIP codes at checkout.  While some have turned off the ZIP code capture feature on their POS systems, others have adopted a new “script” for their tellers to use.  For example, one cosmetics retailer now says, “Would you like to be part of our family?” before asking customers for their ZIP codes at checkout.

We Are Seeking Information

If you have either shopped or worked at a Massachusetts retailer that you know has collected ZIP codes from customers, we want to hear from you. So far, we have brought ZIP code cases against J. Crew, Urban Outfitters, Kiehl’s, and others.

ZIP Codes 

ZIP codes are a system of postal codes used by the United States Postal Service since 1963. ZIP is an acronym for Zone Improvement Plan.

ZIP codes are a system of postal codes used by the United States Postal Service since 1963. ZIP is an acronym for Zone Improvement Plan.

Many pieces of junk mail are now illegal in Massachusetts

According to a recent decision from the Massachusetts Supreme Judicial Court, ZIP codes are personal information, and sending junk mail after collecting a zip code from a customer who pays with a credit card at checkout is illegal under Massachusetts law.  Each piece of junk mail received as a result of this practice is an “injury” entitling the recipient to damages of $25.00 per piece and attorney’s fees, and class representatives may receive incentive awards if deemed approprate by a Court.

What is Consumer Data Collection and Why Do Retailers Do It?

According to a recent article entitled Completing the Customer Picture — Gathering the right information is crucial to the success of a CRM initiative, this is the basic premise:

“While most matching and appending of retail customer data traditionally has been performed by back-end batching and processing, technology is now available that allows this to occur in real or near-real time at the front end of the transaction. Additionally, real-time processing opens the door to more relevant messaging, delivery of personalized offers, and the ability to update or collect missing customer profile elements such as name, phone number, and home, work, or e-mail addresses.

Historically, retailers would use a process called reverse bankcard appending (RBCA) to identify customers personally. Credit card numbers would be captured from polled transactions, batched, and sent to a third-party processing company. Matched records would be sent back to the retailer. This method of identification was controversial due to the sensitivity of credit information that can be attached to consumers through their tender. Ongoing privacy legislation brought the system under legislative scrutiny, causing the major service providers to discontinue it as a service offering.

Once the account is linked to a customer name and address, RBCA can be effective for identifying up to 60 percent of returning customer transactions. Cash transactions are the exception to this type of seamless identification. As cash does not come with a bank account number, other information is required to match these transactions. Bankcard number matching can be favorable as an incremental identification process, but not as a first-line method of identification.”

Stopping Junk Mail & Its Environmental Impact

Junk mail is a problem. It is annoying, intrusive, and unwanted. It wastes paper, gasoline, and contributes to deforestation and pollution. According to the Massachusetts Department of Conservation and Recreation plaque beneath the Artist Ellen Gradman’s work, “7 Days, 36 Families, 100 Pounds” (part of CoolGlobes Greenovate Boston displays around the city) the “average American home receives 1.5 trees in their mailbox every year in unsolicited mail. That adds up to over 100 million trees cut down and over 28 billion gallons of water consumed to produced on year’s worth of junk mail. Reducing the amount of junk mail you recieve will save energy, natural resources, and landfill space. You can begin to tackle the problem by reaching for your phone. Call toll free numbers in unwanted catalogs and ask to be removed from mailing lists. By contacting the Direct Marketing Association you can be removed from mass mailing lists. Organizations can sell your name to other groups unless you ask them to stop.”

Visit DMAChoice.org  to make choices about the junk mail you receive.  Is it really possible to eliminate all junk mail from reaching you? Probably not, but it is possible to cut out most of it.

Artist: Ellen Gradman,

Artist: Ellen Gradman, “7 Days, 36 Families, 100 Pounds” – Boston, MA – 2013

The most persisent and annoying form of junk mail comes addressed like so:

“Or Current Resident”

For these types of mailings, the only way to put an end to it is stopping it at the source.

It takes time, but a small investment pays off with less clutter, less stuff to throw out, and the satisfaction that comes from doing your small part to help the environment.


How to unsubscribe from Victoria’s Secret catalogs: call (800) 411-5116

How to unsubscribe from Pottery Barn Teen catalogs: call (866) 472-0500

Articles About ZIP Code / “Personal Identification Information” by Retailers

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