Save Mart Lawsuit Certified
The Stockton Record - January 5th, 2007
(Record, The (Stockton, CA) (KRT) Via Thomson Dialog NewsEdge) Jan. 5--STOCKTON -- A consumer-protection lawsuit filed 21/2 years ago against Modesto-based Save Mart Supermarkets -- operator of S-Mart stores in Stockton -- has been certified a class action by a San Joaquin County Superior Court judge.
As many as 300,000 Save Mart/S-Mart customers may have been put at risk for credit card fraud and identity theft, according to the Sacramento law firm of Lindsay & Stonebarger, which filed the original suit July 21, 2004, on behalf of five original plaintiffs in San Joaquin County and other Valley communities.
Meanwhile, Save Mart's attorney said not one customer has been the victim of identity theft or financial fraud due to its actions, and that no court in this matter has found that Save Mart has done anything wrong.
Plaintiffs' attorney James Lindsay said that prior to bringing the suit, Save Mart presented its credit card customers with preprinted forms requesting their telephone numbers, knowing that such action was in violation of a California law on the books since the early 1990s.
That law prohibits retailers who accept credit cards from verbally requesting personal identification information and recording that information as part of a credit card transaction. It also prohibits using a preprinted credit card transaction form that contains spaces for customers to fill in identification information, whether or not that information was obtained or ever used.
Violators face a fine of up to $250 for the first offense and up to $1,000 for subsequent violations, according to Lindsay.
"This is the most egregious scenario we have come across. Thousands of Save Mart employees have had access to enough information to cause significant financial damage to customers," he said.
"It is clear that Save Mart knew it was improper to collect this information but continued to do so anyway. The full extent of the damage to customers as a result of this practice is unclear," Lindsay said.
Sacramento attorney Steve Boutin, representing Save Mart, said the Stockton judge's class-action ruling is a procedural order and not based on the merits of the case, and it took an unusually long time for that to occur following two failed attempts by the plaintiffs' attorneys.
"In that time, not one of those plaintiffs has ever been able to show us that they were harmed, injured or damaged. There's not been a penny's worth of actual damages subject to identity theft," Boutin said.
In defending what he called Save Mart's reputation as a "superb corporate citizen," Boutin said the major Northern California grocery chain "never intentially violated any statute including the one that is at issue.
"They've got backbone and work very hard to maintain their reputation and service to customers, and they're not going to have money taken out of their pockets where they haven't done anything wrong," he said.
Former Save Mart customer Phil Kunde of Modesto, who is one of three remaining plaintiffs from the original lawsuit and who described himself as a very private person, was concerned enough with Save Mart's actions to start asking questions. Today, he's even more concerned.
"They were needlessly asking for personal information that they don't need, and like a lot of people, today I'm terrified about identity theft. You don't need anything to process my credit card other than a photo ID," said Kunde, a semiretired consultant to the trade-show industry.
"My next question is, Why isn't somebody stopping this? But nobody had any answers," he said, noting that's when he discussed it with Lindsay.
Kunde said he would have been satisfied had Save Mart simply stopped the practice and said, "We're sorry."
"I feel like I'm being harassed to scare me away. I've never been involved in anything like this before, and I hope I never am again," Kunde said.
A similar lawsuit filed against Dillard's in California ended in August with a settlement in which the Arkansas-based department-store chain agreed to distribute up to 250,000 $20 gift cards to its California customers. It has stores in Stockton, Palmdale and El Centro.