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Urban Outfitters Sued Over ZIP Code Collection

By Betty Wang, JD on June 25, 2013 12:49 PM

Urban Outfitters Inc., which owns the Anthropologie line of stores, is being sued in federal court for requesting customer ZIP codes in violation of the District of Columbia's consumer protection laws.

According to the complaint, which was filed last week and obtained by the Blog of LegalTimes, Urban Outfitters and Anthropologie have been asking customers for ZIP codes in a way that misrepresented the company's ultimate purpose.

Urban Outfitters had allegedly been requesting customer ZIP codes, implying that it was necessary to complete any credit card transaction. In reality, they were used for marketing purposes, the lawsuit claims.

ZIP Code Collection Laws

State laws dictating what merchants can and cannot ask of customers during credit card transactions vary by state. A handful of states limit that information to what is actually required to complete the transaction, according to the Privacy Rights Clearinghouse. If a ZIP code really is required, then this is OK. But if it is not actually mandatory, then this would be a violation of the law.

However, the Urban Outfitters lawsuit goes beyond what merchants can and cannot request -- it takes issue with the nature in which they request it.

In particular, the District of Columbia's Consumer Protection Act makes it illegal for defendants to:

  • Misrepresent as to a material fact which has a tendency to mislead,
  • Fail to state a material fact if such failure tends to mislead, or
  • Use deceptive representations in connection with the sale of goods.

Were Customers Misled?

The issue here, therefore, falls on whether or not customers were misled in allegedly being told their ZIP codes were required -- when they actually weren't, and were instead used to send them marketing materials, according to the lawsuit.

Had Urban Outfitters directly asked a customer for her ZIP code, and disclosed that it was to put her on a mailing list, however, this wouldn't pose a problem. Here, the alleged problem is that Urban Outfitters and Anthropologie didn't appear to be completely honest in their reasons for asking for customer ZIP codes.

It's not yet clear how Urban Outfitters will respond to the lawsuit. The Blog of LegalTimes tried unccessfully to reach a company representative for comment.

Large corporate chain or not, a business is still a business. It bears repeating: Honesty is the best policy.

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