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California retailers may suffer due to zip code ruling

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A recent court case making it a privacy law violation to take down a customer's zip code may become a hardship for major retailers and small businesses alike, according to Inc. Magazine.

According to the source, a recent California Supreme Court ruling went in favor of the plaintiff, who claimed Williams-Sonoma used her zip code to track down other personal information from her, such as her address.

The courts found this practice to be in violation of the Song-Beverly Credit Card Act of 1951, as it concerned access of the customers personal information without prior knowledge. However, this ruling and the maximum $1,000 penalty it carries for violators may cause difficulty for retailers, the source says.

"It's a very unfortunate opinion that’s going to plague retailers who collect Zip codes for very innocent purposes that have nothing to do with tracking somebody down," California attorney David Faustman told the source. "And the potential damages are just massive, amounting to a violation of due process."

Though many of the companies already being targeted are large corporations, small businesses who use zip codes could also potentially be at risk for the costly impact of this ruling. For those who are not protected with small business insurance coverage, the penalty rates could be devastating for their company, should someone bring a claim against them.  

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