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U.S. Supreme Court Denies Cert in Seventh Circuit Case Involving FACTA and E-Commerce

By Mike Nonaka on January 19, 2011
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Yesterday, the U.S. Supreme Court refused to reconsider Shlahtichman v. 1-800 Contacts Inc., in which the U.S. Court of Appeals for the Seventh Circuit held that an email confirmation of an online purchase is not “electronically printed” for purposes of the Fair and Accurate Credit Transactions Act of 2003 (“FACTA”).  Among other restrictions, FACTA prohibits merchants who accept credit cards as payment from printing the expiration date on any receipt provided to the purchaser at the point of sale or transaction. This prohibition applies only to receipts that are “electronically printed.” 

The plaintiff, Eduard Shlahtichman, sued 1-800 Contacts, alleging that the company’s email confirmation violated FACTA because it listed his credit card’s expiration date.  After considering the issue, the district court dismissed the case, strongly suggesting that FACTA does not apply to e-commerce because emailed receipts are not “electronically printed.”  On appeal, the Seventh Circuit agreed with the district court, finding that the ordinary meaning of the term “electronically printed” reaches only those receipts that are printed on paper, and that the use of the term “electronic” did not broaden the scope of the statute beyond paper receipts.

Shlahtichman is one in a series of cases in which courts are struggling to determine the extent to which laws enacted before e-commerce was as widespread as it is today should apply in today’s information economy.

Photo of Mike Nonaka Mike Nonaka

Michael Nonaka, co-chair of the firm’s Fintech Initiative and former co-chair of the Financial Services Group, advises banks, financial services providers, fintech companies, and commercial companies on a broad range of compliance, enforcement, transactional, and legislative matters.

He specializes in providing advice relating…

Michael Nonaka, co-chair of the firm’s Fintech Initiative and former co-chair of the Financial Services Group, advises banks, financial services providers, fintech companies, and commercial companies on a broad range of compliance, enforcement, transactional, and legislative matters.

He specializes in providing advice relating to federal and state licensing and applications matters for banks and other financial institutions, the development of partnerships and platforms to provide innovative financial products and services, and a broad range of compliance areas such as anti-money laundering, financial privacy, cybersecurity, and consumer protection. He also works closely with banks and their directors and senior leadership teams on sensitive supervisory and strategic matters.

Mike works with a number of banks, lending companies, money transmitters, payments firms, technology companies, and service providers on innovative technologies such as bitcoin and other cryptocurrencies, blockchain, big data, cloud computing, same day payments, and online lending. He has assisted numerous banks and fintech companies with the launch of innovative deposit and loan products, technology services, and cryptocurrency-related products and services.

Mike has advised a number of clients on compliance with TILA, ECOA, TISA, HMDA, FCRA, EFTA, GLBA, FDCPA, CRA, BSA, USA PATRIOT Act, FTC Act, Reg. K, Reg. O, Reg. W, Reg. Y, state money transmitter laws, state licensed lender laws, state unclaimed property laws, state prepaid access laws, and other federal and state laws and regulations.

Read more about Mike NonakaEmail
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  • Posted in:
    Business and Commercial
  • Blog:
    Inside Privacy
  • Organization:
    Covington & Burling LLP
  • Article: View Original Source

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