Gas Companies Can Legally Request Your Zip Code for Credit Card Purchases at the Pump

I get annoyed every time I pay at the gasoline pump and am asked to enter my zip code after inserting my credit card.  I will continue to be annoyed in the future.   A recent Court of Appeal decision has OK’d this practice.

In Flores v. Chevron U.S.A. Inc. (2d Dist. Div. 1, B240477, June 20, 2013), a class action challenged the practice, alleging it violated the Song-Beverly Credit Card Act of 1971 (“Act”). Among other things, the Act, generally prohibits a merchant from requesting personal identification information (including a zip code), as a condition of accepting credit card payment.  (Civ. Code  § 1747.08(a).)  There are several exceptions, including one where the personal identification information is “required for a special purpose incidental but related to the individual credit card transaction, including, but not limited to, information relating to shipping, delivery, servicing, or installation of the purchased merchandise, or for special orders.”  (Civ. Code, § 1747.08(c)(4).)  The gas companies cited this exception as justification for requesting the zip code, explaining that the information was requested solely to prevent fraud.

Flores argued that the exception did not apply, because the gas companies did not “require” the zip code to complete the transaction.  The Court of Appeal rejected the argument, reasoning that fraud prevention was “incidental” and related to the credit transaction. 

Note that there was no evidence that the gas companies used the zip code information for marketing purposes.  If there had been such evidence, the result might have been different.

Posted by Ann C. Schneider, Law Office of Ann C. Schneider.  Ms. Schneider provides civil litigation services in the Greater Los Angeles area.  Any questions or comments should be directed to Ms. Schneider at aschneider@aschneiderlaw.com; (626) 789-1980.  Ms. Schneider’s website is located at www.aschneiderlaw.com. 

Ms. Schneider focuses her practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and family law proceedings, as well as mediation.