PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

___________

No. 11

- 1554

____________

RANDY LONG, individually and on behalf of all others similarly situated, Appellant

v.

TOMMY HILFIGER U.S.A., INC.

____________

APPEAL FROM THE UNITED STATES DISTRICT

COURT

FOR THE WESTERN DISTRICT OF PENNSYLVANIA (D.C. Civil No. 09

- cv

- 01701 ) District Judge: Honorable Joy Flowers Conti

___________

Submitted Under Third Circuit LAR 34.1(a)

December 5 , 2011

___________

Before: HARDIMAN

, BARRY and VAN ANTWERPEN

, Circuit Judges

(Opinion Filed: January 24 , 2012 )

___________

Gary F. Lynch Stephanie K. Goldin

36 N. Jefferson Street

P.O. Box 7635 New Castle, PA 16107

Counsel for Appellant2 John G. Papianou Montgomery, McCracken, Walker & Rhoads, LLP 123 South Broad Street, 24th Floor Philadelphia, PA 19109

- and

Stanley M. Stein Feldstein, Grinberg, Stein & McKee

428 Boulevard of the Allies Pittsburgh, PA 15219

Counsel for Appe llee

___________

OPINION OF THE COURT

___________

BARRY, Circuit Judge

The Fair and Accurate Credit Transactions Act (“FACTA”) provides , in relevant part, that merchants who accept credit or debit cards shall not print “the expiration

date” of the car ds upon any receipt provided to the cardholder at the point of the sale. The question in this case is whether a retailer willfully violates th at statute by printing the expiration month, but not the year, of the credit card on a receipt. The

District Cou rt answered that question in the negative, and

dismissed appellant Randy Long’s c omplaint against Tommy Hilfiger U.S.A., Inc. W e will affirm.

I.

On October 29, 2009, Long made a purchase of “ men’s

neckwear ” using his credit card at a Hilfiger store in Grove City, Pennsylvania. His credit card was charged $24.99

, and Hilfiger gave him an electronically

- printed receipt that redacted all but the last four digits of his credit card number and displayed the month, but not the year, of his card’s expirat ion date. In pertinent part, the receipt read as follows:3 SALESPERSON # 8399

881300009340 MENS NECKWEAR 24.99

TOTAL $24.99

VISA $24.99

############9802

PURCHASE

EXPIRY: 04/## SWIPED

(JA 46.)

On December 29, 2009, Long filed this act ion against Hilfiger alleging that Hilfiger’s printing of “EXPIRY: 04/##” on his receipt willfully violated FACTA’s prohibition against printing the expiration date. Long sued on his own behalf and asserted a putative nationwide class action on behalf of all others similarly situated. He sought statutory damages for the alleged violation, as well as punitive damages, attorneys’ fees,

and costs.

Hilfiger moved to dismiss Long’s c omplaint pursuant

to Federal Rule of Civil Procedure 12 (b)(1) and (6) . Wit h the consent of the parties, the District Court denied the motion without prejudice and referred the case to mediation. Mediation was unsuccessful, and Hilfiger renewed the motion to dismiss. On February 11, 2011, the District Court granted

t he motion

, concluding that (1) printing the month of expiration, standing alone, did not constitute the printing of an “expiration date” under the statute, and (2) in any event, Long could not recover because the alleged violation was not

“willful.” Long appealed.

II.

The District Court had jurisdiction over this case pursuant to 28 U.S.C. § 1331 and 15 U.S.C. § 1681p. We have appellate jurisdiction under 28 U.S.C. § 1291

, and exercise plenary review over both the grant of a motion to

dismiss

, Fagin v. Gilmartin

, 4 32 F.3d 276, 281 (3d Cir. 2005), and questions of statutory interpretation, DIRECTV4 Inc. v. Seijas , 508 F.3d 123, 125 (3d Cir. 2007).

A.

In 2003, Congress amended the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq. , by enacting FACTA. See Pub.

L. No. 108

- 159, 117 Stat. 1952 (2003). As part of an effort to prevent identity theft, FACTA prohibits merchants from printing certain credit and debit card information on receipts. In particular, it provides:

( g) Truncation of credit card and debit card

n umbers

. . . .

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.

15 U.S.C. § 168 1c(g)(1)

. 1

FACTA imposes civil liability for violations of this provision, with the available remedies depend ent upon whether the violation was negligent or willful. If a

mercha nt’s violation wa s merely negligent, a plaintiff may recover only actual damages, and statutory damages are not

available. Id . at § 1681o (a)(1)

. If the violation wa s willful, however, FACTA allows a plaintiff to elect to recover either actual damages or statutory damages between $100 and $1,000. Id . at § 1681n(a) (1)(A)

. A court may also award punitive damages in cas es involving willful violations. Id . at § 1681n(a) (2)

.

1 FACTA expressly limits the reach of this subsection “to receipts that are electronically printed, and [does] not apply to

transactions in which the sole means of recordin g a credit card or debit card account number is by handwriting or by an imprint or copy of the card.” 15 U.S.C. § 1681c(g)(2).5 In 2008, almost five years after the passage of FACTA, Congress enacted the “Credi t and Debit Card Receipt Clarification Act” (“Clarification Act”). See Pub. L. No. 110

- 241, 122 Stat. 1565 (2008). The Clarification Act arose from “hundreds of lawsuits” that were filed against merchants after the effective date of FACTA, alleging that merchants’ “ failure to remove the expiration date was a willful violation” of the

statute , even though the account number was properly

truncated. Clarification Act § 2(a)(4), 122 Stat. at 1565. Congress found that many merchants mistakenly believed that § 1681c(g) would be satisfied solely by truncating the card number and not the expiration date. Id . at § 2(a)( 3 ), 122 Stat.

at 1565. It noted that none of the lawsuits that had been filed alleged any actual harm to the consumer’s identity

, and “[e]xperts in the field agree that proper truncation of the card number . . . regardless of the inclusion of the expiration date, prevents a potential fraudster from perpetrating identity theft

or credit card fraud.” Id . at § 2(a)(5)

- (6) , 122 Stat. at 1565

. It

dee med these lawsuits to be a significant burden on businesses, without any corresponding consumer benefit. Id

. at § 2(a)(7) , 122 Stat. at 1565

- 66 . Therefore, Congress amended FACTA to state that any merchant who printed an expiration date, but otherwise co mplied with FACTA, between the dates of December 4, 2004 and June 3, 2008, shall not be deemed in willful noncompliance with § 1681c(g). Id . at § 3(a) (codified at 15 U.S.C. § 1681n(d) ),

122 Stat. at 1566

.

B.

This appeal raises two related questions . T he first is whether Long’s allegation that Hilfiger print ed his credit card’s expiration month, but not the year, states a claim under

FACTA. If so, the second question is whether such a

violation of the statute meet s the standard for “ willfulness

. ”

Thes e are issues of first impression among the federal courts of appeals. We will address each in turn.

1.

Determining whether Long has stated a claim under6 FACTA requires us to interpret the statute. The principles governing statutory interpretation are w ell

- known

. Our role is to give effect to Congress’s intent , which we assume is expressed in the ordinary meaning of the statutory language. Disabled in Action of Pa. v. Se. Pa. Transp. Auth. , 539 F.3d 199, 210 (3d Cir. 2008). In analyzing whether the st atutory language is un ambiguous, “ we take account of ‘ the specific context in which that language is used, and the broader

context of the statute as a whole. ’ ” Id

. (quoting In re Price

, 370 F.3d 362, 369 (3d Cir. 2004). We also consider the “overall obje ct and policy of the statute, and avoid constructions that produce odd or absurd results or that are

inconsistent with common sense.” Id . (citation and internal quotation marks omitted). In addition to following these general rules of statutory interpret ation

, we are mindful that remedial legislation should be construed broadly to effectuate its purpose. Idahoan Fresh v. Advantage Produce, Inc. , 157 F.3d 197, 202 (3d Cir. 1998)

.

The critical inquiry before us is the meaning of

FACTA’s requirement that no person shall print “the expiration date.” The phrase “ e xpiration date” is not defined

in the statute. Hilfiger argues

, however, that the phrase refers

to an ascertainable date on which the credit or debit card ceases to be valid, and requires the simu ltaneous coexistence of both the month and the year. Hilfiger concludes, therefore, that merely printing “April” or “04” does not constitute printing an “expiration date” within the meaning of § 1681c(g) (1)

.

We disagree. Taking Hilfiger’s argument to its logical conclusion, a merchant would not violat e FACTA so long as it redacted even a single number from either the month or year of the card’s expiration date. Furthermore, different merchants could each choose to redact different portions of the expi ration date, making it possible to ascertain the entire expiration date from multiple receipts. This, of course, would

be inconsistent with the statute’s objective of preventing identity theft and a result certainly not intended by Congress

.

We conclude that t he most natural reading of the7 phrase “expiration date” is that it refers to the information or data (usually a string of numbers) contained in the expiration

date “ field ” on the face of the credit or debit card. In other words, FACTA is best read a s prohibiting merchants from printing the numbers in t hat field, which Long alleges Hilfiger did in this case by printing “ EXPIRY : 04/##.” The fact that Hilfiger printed only a part or portion of the expiration date

numbers from Long’s credit card does no t change the result

. To be sure, FACTA is silent as to the effect of a partial printing of the expiration date

. Nevertheless, if Congress had intended to allow a partial printing, it w ould have used language similar to what it used for credit or debit ca rd numbers. With respect to card numbers, Congress clearly indicated the scope of disclosure allowed by specifically stating that no merchant shall print “ more than the last 5 digits of the card number.” 15 U.S.C. § 1681c(g)(1) (emphasis supplied) . Cong ress demonstrated that it knew how to use language allowing for the partial disclosure of information, but elected not to include any such language in the context of expiration dates. Therefore, we cannot
conclude that FACTA provide s an exception for merc hants

who redact part of the expiration date informatio n on the receipt.

Hilfiger’s reliance on the Clarification Act is unpersuasive. Despite having the occasion to specifically consider the issue of expiration dates, Congress did not

cha nge the actual language of § 1681c(g) (1) or otherwise alter the liability standard of the statute. Just as before, the statutory language state d that “no person . . . shall print . . . the expiration date” on a receipt. What Congress did do was

to provid e a safe harbor for merchants who had been sued for printing such dates. We will not assume that Congress

intended a greater limitation of liability than what is explicitly stated in the statutory text.

For these reasons, and consistent with ou r duty to interpret remedial statutes broadly, Idahoan , 157 F.3d at 202,

we hold that § 1681c(g) (1) prohibits a merchant from printing expiration date information on a receipt provided to the consumer, even if the year is redacted. Therefore, Long8 properl y alleged that Hilfiger violated FACTA

. 2

.

Having determined that Long properly all eged a

violation of FACTA , we next ask whether FACTA authorizes

him to recover for th e violation. Long concedes that he did not suffer any actual damages, and instead r equests statutory damages together with punitive damages and attorneys ’ fees under 15 U.S.C. § 1681n(a). As noted above, however, Long is not eligible for such relief unless he can allege, and ultimately prove, that the violation of the statute was

“ willf ul

. ” Id

.

The Supreme Court addressed the willfulness requirement of § 1681n(a) in Safeco Ins. Co. of Am

. v. Burr

, 551 U.S. 47 (2007). In Safeco , the Court considered a provision of the Fair Credit Reporting Act which requires

notice to a consumer sub jected to “adverse action . . . that is based in whole or in part on any information contained in a consumer [credit] report.” 15 U.S.C. § 1681m(a). With respect to an insurance company, an “adverse action” is defined in part as “an increase in any charg e for, or a reduction or other adverse or unfavorable change in the terms of coverage or amount of, any insurance, existing or applied

for.” Id . at § 1681a(k)(1)(B)(i). The defendant insurance companies in Safeco argued that they did not violate the

stat ute by failing to give notice, because the plaintiffs’ claims were based on “initial rates charged for new insurance policies.” Safeco , 551 U.S. at 60

- 61. The defendants argued that the initial rate for a new policy “cannot be an ‘increase’

because there is no prior dealing” between the parties. Id

. at
61. In other words, the defendants argued that the statutory reference to “increase in any charge” was meant to cover “change[s] in treatment for an insured, which assumes a previous charge for compariso n.” Id

.

The Supreme Court rejected the defendants’ interpretation, concluding that applying the statute to initial rates for new policies is a “better fit with the ambitious objective set out in the Act’s statement of purpose.” Id . at 62. Although f inding a violation of the statute, however, the9 Court concluded that the violation was not willful because the willfulness component is not met “unless the action is not only a violation under a reasonable reading of the statute’s terms, but shows that the company ran a risk of violating the

law substantially greater than the risk associated with a reading that was merely careless .” Id . at 69 (emphasis supplied). Accordingly, the Court held that a violation does not cross the willfulness threshold just be cause a defendant’s interpretation is erroneous; it must instead be “objectively

unreasonable.” Id

.

The “objectively unreasonable” standard was not met

in Safeco for several reasons. First, the statute itself was

“ silent on the point from which to mea sure ‘ increase ’” and the Supreme Court considered the statutory text “less

- than

pellucid.” Id . at 69

- 70. Second, the defendant’s proposed interpretation had a “foundation in the statutory text

. . . and a sufficiently convincing justification to have per suaded the District Court to adopt it.” Id . Finally, the Court noted that “[b]efore these cases, no court of appeals had spoken on the issue, and no authoritative guidance has yet come from the

FTC.” Id . at 70. Accordingly, the Court concluded that the defendant’s reading was not objectively unreasonable

, and fell “well short” of meeting the willfulness standard. Id. ; see also

Shlahtichman v. 1

- 800 Contacts, Inc. , 615 F.3d 794, 803

- 04 (7th Cir. 2010) (applying Safeco to conclude it was objectively reas onable for merchant to believe § 1681c(g) did not apply to e

- mailed receipts).

In light of Safeco , we conclude that Hilfiger’s interpretation of the statute is not “objectively unreasonable”

and

, thus , that Long has not stated a claim for a willful

viol ation of FACTA . Just as in Safeco , Hilfiger’s interpretation of § 1681c(g) (1) has some foundation in the text, as Hilfiger could believe that the statute did not apply

based on what it considered to be the plain meaning of the phrase “expiration date.” T h at phrase is not defined in the statute itself, just as the statute in Safeco was silent as to the point from which to measure an increase in a charge for

insurance. Furthermore, despite the fact that we reject Hilfiger’s interpretation of the § 1681c(g) (1) language

, it was10 at least sufficiently persuasive to convince the District Court to adopt it. Although Long argues that there was district court authority putting Hilfiger on notice that its interpretation was incorrect, 2 there was no guidance fr om th e federal courts of appeal on this issue. 3

Long’s additional arguments on this point are unpersuasive

. He conten d s that it is possible that Hilfiger

“did not actually rely on any interpretation” of § 1681c(g) (1)

, and instead “disregarded the statute altogether and is only now seizing upon a post hoc ‘objectively reasonable’ interpretation in order to shield itself from liability.” Appellant’s Br. at 25. This argument, however, is expressly foreclosed by Safeco , which held that evidence of subjective

bad faith or intent of the defendant is irrelevant when there is

2 Long cites, for example, Follman v. Hospitality Plus of Carpentersville, Inc. , 532 F. Supp. 2d 960, 964 (N.D. Ill. 2007); Iose llo v. Leiblys, Inc. , 502 F. Supp. 2d 782, 786 (N.D. Ill. 2007); Arcilla v. Adidas Promotional Retail Operations,

Inc. , 488 F. Supp. 2d 965, 970 (C.D. Cal. 2007); and Ramirez v. Midwest Airlines, Inc. , 537 F. Supp. 2d 1161, 11 71 (D. Kan. 2008) . These deci sions are not directly on

- point because they involve merchants who, unlike here, printed the entire expiration date.

3 Long argues there was agency guidance on this issue, citing to a brief FTC “Business Alert” indicating that merchants

“must delete the card’s expiration date[, f]or example . . .

EXP: ****.” Slip Showing? Federal Law Requires All

Business es to Truncate Cred it Card Information on Receipts (May 2007). W e are doubtful that this Business Alert

constitute s the kind of “authoritative guidance ” from the agency envisioned by the Supreme Court. See Safeco , 551

U.S. at 70 n.19 (rejecting the FTC document relied upon by plaintiffs because it was a letter written by an FTC staff member that “did not canvas the issue” in question and was merely an i nformal opinion not binding on the Commission). In any case, we cannot conclude from this Business Alert standing alone that Hilfiger ran a risk of violating FACTA substantially greater than the risk associated with a reading that was merely careless

.11 an objectively reasonable interpretation of the statute that would allow the conduct in question. See Safeco , 551 U.S. at

70 n.20. Thus, Long’s allegation about Hilfiger’ s actual knowledge or intent as to FACTA’s requirements is

immaterial to the objective reasonableness analysis . For these same reasons, we are also unpersuaded by Long’s argument that he requires discovery to establish Hilfiger’s subjective knowledge. See Shlahtichman , 61 5 F.3d at 803

- 04 (affirming a 12(b)(6) dismissal of a FACTA complaint in part on the ground that the defendant’s proffered interpretation was objectively reasonable); Safeco , 551 U.S. at 71 (concluding defendant’s interpretation was objectively reasonable and finding “no need . . . to remand the cases for factual development”).

In sum, we conclude that Hilfiger’s interpretation of § 1681c(g) (1) , although erroneous, wa s at least objectively

reasonable

. Hilfiger did not run “a risk of violating the law

sub stantially greater than the risk associated with a reading that was merely careless.” Safeco , 551 U.S. at 69. Accordingly, Long has not stated a claim for a willful

violation of FACTA, and the District Court did not err in dismissing his c omplaint.

III

.

For the foregoing reasons, we will affirm the order of

the District Court.