Seventh Circuit Limits FACTA Requirements for Truncating Credit Card Numbers on Printed Receipts

20 June 2012 Consumer Class Defense Counsel Blog

In Straaten v. Shell Oil Prods. Co. LLC, 678 F.3d 486 (7th Cir. Ill. 2012) the Seventh Circuit interpreted and clarified the Fair and Accurate Credit Transactions Act (FACTA), 15 USC § 1681c(g) requirement that an electronically printed receipt not display “more than the last 5 digits of the card numbers.” Neither the statute nor the agencies with the authority to interpret the statute, the Federal Trade Commission and the Consumer Financial Protection Bureau, had defined the term.  

15 USC § 681c(g) states: “Except as otherwise provided in this subsection, no person that accepts credit cards or debit cards for the transaction of business shall print more than the last 5 digits of the card number or the expiration date upon any receipt provided to the cardholder at the point of the sale or transaction.”

The Plaintiff argued that Shell violated FACTA by printing the last four digits of the customer’s account number rather than the final four numbers on the card’s magnetic strip.  She argued, and the District Court held, that an electronic receipt had to comply with only one specific sequence in order to comply with the act. The Seventh Circuit found that a precise definition of “card numbers” was unnecessary “as long as the receipt contains too few digits to allow identity theft.” The Court made its determination based on the purpose of the statute, rather than the technicalities surrounding it.   

Plaintiff made an argument based on industry standards, stating that the primary account number was an understood term and that Shell’s use of a different number was an unjustifiable variation of this practice. The Court rejected this argument, finding that an “everyone knows” approach was not consistent with the meaning or purpose of the statute or the statutory text of “card number.” Instead, the Court applied a willfulness standard to determine whether Shell’s choice of numbers to print on the receipt was “objectively unreasonable.” It found that this choice was not objectively unreasonable and did not implicate the purpose of FACTA.

In a concurring opinion, Judge Cudahy joined “without reservation the comprehensive majority opinion” and wrote separately to comment on the issue of willfulness. He stated that willfulness would be determined by the objective reasonableness of the interpretation rather than the credentials of individual company evaluators.

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