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Appeals panel says Sears data disclosure doesn’t harm credit card holders, so suit is tossed

COOK COUNTY RECORD

Sunday, November 24, 2024

Appeals panel says Sears data disclosure doesn’t harm credit card holders, so suit is tossed

A Chicago appeals courts has affirmed a lower court ruling that shelved a class-action suit against Sears, Roebuck & Co., which alleged the retail giant sold credit card holders’ personal data to telemarketers, because card holders took no financial hit as a result of Sears’ action. 

Justice Jesse Reyes delivered the decision Jan. 5 in Illinois First District Appellate Court, with concurrence from justices Robert Gordon and Bertina Lampkin. The justices filed the unpublished order under Supreme Court Rule 23, which means it may not be cited as precedent, except in the limited circumstances permitted by Rule 23. 

Between 2001 and 2003, three suits were filed, which were later consolidated into a class-action suit in Cook County Circuit Court, against Sears, which is based in suburban Hoffman Estates. The action alleged Sears made millions of dollars selling the personal information of credit card holders to telemarketers, direct mail marketers and other vendors, which violated the agreements between Sears and its credit card holders. 

The information included names, ages, addresses, phone numbers, credit card account numbers, credit card balances and limits, estimated incomes and recent purchase information.

Plaintiffs claimed Sears intended the shared information be used to “bombard Plaintiffs with unwanted telephone calls and mailed advertisements, with Sears itself profiting off that intended use.” 

Plaintiffs’ suit alleged Sears committed invasion of privacy, breach of contract, unjust enrichment and consumer fraud. Circuit Judge Mary Mikva, who is now an appellate justice, dismissed the suit in 2014 on several grounds, which were upheld on appeal. 

The big hole in plaintiffs’ case, was their failure to show Sears’ action hurt them in the pocketbook, according to Justice Reyes. There was no evidence plaintiffs were wrongly charged for any products or services, suffered identity theft or had to outlay money for any reason, Reyes reasoned. All plaintiffs were able to say in this regard was, as one put it, “I believe that my privacy has been damaged,” or as another said, my “trust in a company like Sears has been abused.” 

Reyes also determined the card holders’ information may have been confidential, but that did not mean it was private, especially given that card holders voluntarily provided the information to Sears, during which it lost whatever privacy it may have held.

Reyes added the data was not made a matter of public or general knowledge, even though Sears demonstrated some of the information in question was already available from public sources, such as court records and phone directories. At any rate, Reyes said none of the information was “revealing, compromising or embarrassing.” 

Plaintiffs also appealed a lower court order from 2004 that denied plaintiffs’ motion to enforce an alleged settlement. 

Plaintiffs contended Sears agreed to settle, with Sears paying part of plaintiffs’ legal fees and costs. Sears disagreed, saying there was no “meeting of the minds” and certain matters remained unsolved after negotiations, including plaintiffs’ costs. 

Reyes backed up the 2004 decision, quoting the lower court judge, who had pointed out there were no “evidentiary submissions that the parties had agreed, as part of an overall settlement, to a mechanism to decide the fees and costs.” 

Sears has been represented by the Miami-based international firm of Greenberg Traurig, which has a Chicago office, and the Chicago firm of Albert, Whitehead, P.C. 

Plaintiffs have been represented by the Chicago firms of Barnow & Associates, Barnow & Goldberg and Edelman, Combs, Latturner & Goodwin.

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