Hunton Retail Law Resource

An insured seeking coverage for credit card fees assessed against its third-party payment processor following a data breach recently filed an appeal in the Fifth Circuit Court of Appeals. Spec’s, a liquor store chain with over 160 locations throughout Texas, suffered two major data breaches of its credit card payment system, resulting in the loss of customer information and credit card numbers. Spec’s accepts Visa and MasterCard payments from its customers through a third-party processor, First Data. As a result of the breach, First Data incurred liability assessments from ...

Coastal areas in Texas have already begun evacuating as Hurricane Harvey heads for the Gulf Coast. Weather experts anticipate that the windstorm will reach Category 3 or Category 4 status by the time it makes landfall on the Texas coast late Friday night or early Saturday morning, making it the first Category 3+ storm to make landfall in the United States since Hurricane Wilma hit South Florida in October 2005.

On August 15, 2017, the FTC announced that it had reached a settlement with Uber, Inc., over allegations that the ride-sharing company had made deceptive data privacy and security representations to its consumers. Under the terms of the settlement, Uber has agreed to implement a comprehensive privacy program and undergo regular, independent privacy audits for the next 20 years.

Development International, an NGO with affiliates around the world, recently published its third annual report (the “Report”) summarizing U.S. public company Conflict Minerals Reports ("CMRs") filed on Form SD for reporting year 2016. Although the Report advances a very narrow reading of the recent D.C. Circuit case striking down part of the SEC conflict minerals rule, it otherwise provides a wealth of statistical information about the most recent round of Form SD filings. This information can be useful to retailers benchmarking their own Form SD reporting as well as the Form SD reporting of key suppliers.

Liability insurance policies generally have an exclusion barring coverage for claims brought by the insured’s own employees. These exclusions usually do not bar coverage, however, when claims are brought by an employee of one insured against another insured. This scenario occurs frequently, especially for companies in the retail industry, who are usually one of multiple insureds under a single policy and are susceptible to being sued by another insured’s employees.

It is no secret that California has had appliance efficiency standards in place for some time now. And it is no secret that the California Energy Commission (“CEC”) has been responsible for crafting those standards. According to the CEC and the California State Legislature, however, compliance with those standards has been hit-or-miss. In 2011, the Legislature found that “significant quantities of appliances are sold and offered for sale in California that do not meet the state’s energy efficiency standards,” and the CEC itself has stated that nearly half of all regulated appliances are non-compliant, and that certain product categories are entirely non-compliant. The broad range of products covered by the CEC’s efficiency standards may be partly to blame for the lack of compliance, as manufacturers may not even realize their product must comply. For example, the efficiency standards encompass nearly every device with a rechargeable battery and that rechargeable battery system, meaning everything from cell phones to laptops to tablets to golf carts must be tested, certified and listed in the CEC’s database before being offered for sale in California. 

On August 2, 2017, the U.S. Senate confirmed one of President Trump’s two management-side appointees, Marvin Kaplan, to the National Labor Relations Board (“NLRB”) in a contentious vote along party lines. Kaplan was sworn in on August 10, 2017, for a term ending on August 27, 2020. 

The Santa Barbara City Council, in an effort to combat the retail malaise on State Street in Downtown Santa Barbara, has approved a pilot program that would streamline the permit and review process for potential commercial tenants.

This past week, several consumer actions made headlines that affect the retail industry.

FTC Extends Comment Period for Paint Claims

On August 7, 2017, the FTC extended the public comment period related to four proposed settlements with paint companies. According to the original complaints from June 2017, Benjamin Moore, Imperial Paints, ICP Construction and YOLO Colorhouse deceptively claimed that their paint products were either emission-free or contained zero volatile organic compounds, including during and immediately after application. 

On August 7, 2017, the FTC announced that it obtained a court order temporarily halting an online marketing scheme that deceptively lured shoppers into expensive negative option plans. The FTC alleged in its complaint that defendants used initial low-cost “trial” offers to hook consumers into expensive monthly shipments for tooth-whitening products without properly disclosing the terms and conditions of the deal or properly obtaining their consent.