Sunday, August 08, 2004

Do Customer Loyalty Cards Create a Retailer’s Duty to Warn?

When a customer applies for a loyalty card at any of a growing number of retailers, the customer is required to reveal a certain amount of personal information. The retailer then tracks the customer’s purchases and matches them with the customer’s personal data in order to tailor its marketing to that customer. Some retailers also use the customer’s application information to collect even more information from commercial databases and public records.

In exchange for giving up information about themselves, customers usually get discounts in the store and personalized advertisements and offers in the mail. Should consumers expect more from the retailer? A lawsuit in a Washington state court says they should. Jill Crowson has sued the grocery chain, Quality Food Center (QFC), for failure to warn her family, which QFC could have done using information it had gathered with its loyalty card program, when ground beef the Crowsen’s had purchased was recalled in December's mad-cow scare.

For more information on the issues raised by this lawsuit, see Anita Ramasastry’s article, Do Stores That Offer Loyalty Cards Have a Duty to Notify Customers of Product Safety Recalls? on Findlaw’s Writ at

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