Stores Fighting Chargebacks
Stores Seek To Block Credit Card Fraud Rules In Antitrust Suit
A proposed class of retailers asked a California federal court Friday to block
major banks and credit card companies from enforcing new fraud liability rules
while the merchants pursue an antitrust lawsuit.
In a motion for a preliminary injunction, B & R Supermarket Inc. and Grove
Liquors LLC said they and other retailers have lost time, money and customers
since Oct. 1, when Visa Inc., MasterCard Inc., Bank of America Corp.,
Citigroup Inc. and other companies socked them with greater liability for
"Without an injunction, plaintiffs and members of the proposed class will
continue to lose customers, waste time and be charged for certain transactions
which they are unable to avoid," the merchants said.
Friday's bid for an injunction came three days after B & R Supermarket and Grove
Liquors launched the suit, which claims that the "liability shift" violated
the Sherman Antitrust Act, California's antitrust regulations and other
The credit card companies and banks shifted the fraud liability to merchants who
were not ready by Oct. 1 to use microchip-enabled EMV (Europay, MasterCard,
Visa) cards, without consulting with them or giving them the chance to opt out
or object, according to the retailers.
The merchants said the banks and credit card companies made it impossible for
small businesses to comply with the new fraud policy because they had to
shell out hundreds of dollars for new equipment and face a "Byzantine
They also said the new policy is causing irreparable harm to small businesses
- harm that can't simply be cured with a monetary judgement. For example, one of
the retailers said it's now asking for identification with all card purchases, a
practice it claims has "alienated some customers to the point that those
customers may not return." Editor's Note: This is liable to be merely one of
many law suits fighting the credit card companies over the actual roll-out
process itself, the lengthy terminal certification process, the capital
investments, and the chargebacks. law360.com
Canadian Press Continues Facial Recognition Coverage
'Face-reading tech could make shopping more convenient - and creepier'
Software that detects age, gender, gaze and emotions could have privacy risks
Software like Eyeris's Emovu, NEC's Neoface or Eyesee let retailers determine
your gender, race and approximate age, where and how long you looked at
different displays and whether you were smiling or frowning at the time.
"You're getting into this area of creepiness, really, where you may not know
that this is happening and you may not know how much this is actually
happening," said White, a lawyer with the Ottawa-based Public Interest Advocacy
But Randy Lippert, an associate professor of criminology at the University of
Windsor who conducts research on camera surveillance, says it's way more
intrusive than normal security video," he said. "This is really, really intimate
information that may seem harmless on the surface. But who knows in particular
contexts what it could be used for."
That could include manipulative marketing or even discrimination by age, gender
or race. And customers won't necessarily know how the information is stored or
shared with third parties.
Canada's privacy commissioner notes that "facial image data is particularly
sensitive because it is unique and can be linked to many other individual level
While Canada's Personal Information Protection and Electronic Documents Act
requires businesses to obtain consent from customers to obtain their
personal information for particular purposes, a 2012 study found that most
stores failed to comply with privacy laws even when using ordinary
The Office of the Privacy Commissioner acknowledged that "since facial
recognition can be carried out surreptitiously without individuals' knowledge
and consent, it may sometimes prove tempting for organizations to simply not
inform individuals, and individuals would have no way of knowing how their
personal information is being used."
While a 2015 survey by IT consulting firm Computer Science Corp. found 27 per
cent of U.K. retailers use facial recognition, Lippert said he doesn't think
anyone knows the extent of its use in Canada.
Some recent reports suggested that high-end fashion retailer Saks Fifth
Avenue, which opened its first Canadian stores this month, uses facial
recognition to identify potential shoplifters. However, the company told CBC
News that those reports are "erroneous."
The Office of the Privacy Commissioner of Canada told CBC News Friday it has not
received any complaints about retail use of facial recognition technology.
Recognizing behavior that may lead to workplace violence
The Occupational Safety and Health Administration now averages over 2 million
reported cases of violence each year. It's estimated that businesses in the
United States have an economic cost of over $170 billion as a result of
workplace violence. The statistics are staggering, and the problem continues
to get worse.
Businesses, managers and employees need to be trained about how to recognize
early stages of behavior that may lead to some types of workplace violence.
Changes in behavior to be aware of include excessive tardiness or absence,
reduced productivity, strained workplace relationships, changes in
health/hygiene, fascination with weapons, substance abuse, excuses and blaming,
and/or depression. Knowing your co-workers and being able to identify changes in
their behavior enables a business to provide early intervention. Establishing
reporting procedures for employees and supervisors also helps with early
Several other techniques have proven successful in establishing standards around
behavior, such as conducting background checks. When hiring new employees,
review information to determine if the employee has a history of violence or
threats. Adopt a zero-tolerance policy for any type of violence, including
verbal abuse or harassment.
Physical security and safeguards are another essential factor. This includes
locking appropriate doors, analyzing security procedures and developing
consistent standards. Employers may be sued for negligence if they were aware of
but did not address a potentially dangerous situation. Creating a safe
environment is a critical part of an employer's responsibility.
Retail's gift card crackdown self-defeating
In an attempt to fight theft, some retailers have started to crack down on how
gift cards are purchased. This move is ultimately self-defeating, if not
The proper fix for this problem is to close the loop. Make sure that every
purchase of a gift card includes the serial number of that card, so that
a canceled payment card can almost instantly cancel all recently purchased gift
cards. But the retail industry has opted for a different way. Instead of
universally fixing the hole, they have opted to make it harder for legitimate
shoppers to purchase gift cards.
"Some merchants are requiring that customers buy the cards with cash or asking
that they show identification. Others have cut back to smaller denominations,
put limits on repeat purchases or stopped selling certain cards altogether,
according to people who are familiar with the stores' policies. The restrictions
are putting a crimp on an increasingly popular form of plastic, not only among
gift-givers, but also among shoppers - in stores and online - looking to rack up
loyalty points by using a credit card," noted The Wall Street Journal. "Kroger
is in the midst of upgrading its checkout equipment to accept chip cards and
expects to complete the overhaul by the end of the month. To ward off thieves,
the grocer is limiting the number of gift-card purchases that are made on a
credit card within a 24-hour period, said Chris Hjelm, the chain's chief
If the retailer doesn't feel like linking card IDs to purchases - which
is potentially the best long-term answer - what about asking for additional
identification on gift cards? That would address the fraud fears without
making the cards more difficult to sell. computerworld.com
Judge Trims Whole Foods Discrimination Cases
Racial Bias - Prior Criminal Convictions - Security Investigation & Emails
A New York federal judge on Monday narrowed a pair of discrimination suits
against Whole Foods, ruling that two former employees of the grocery chain could
pursue claims for racial bias but not for alleged discrimination on the basis
of their prior criminal convictions.
During a hearing in Manhattan court, U.S. District Judge Valerie Caproni
partially denied a motion by Whole Foods Market Inc. to dismiss claims by Danny
Batts and Michael Robinson, who resigned from positions in the receiving
department of the company's Tribeca store shortly after being demoted in October
According to court documents, Whole Foods launched an investigation to
determine whether Batts and Robinson were selling empty wooden pallets for
personal profit, but found no conclusive evidence of wrongdoing.
Nonetheless, the company decided to demote Batts and Robinson for allegedly
failing to perform their leadership duties.
Batts, who is Hispanic, and Robinson, who is black, have argued that Whole
Foods' explanation was merely a pretext for discriminating against them on
the basis of their race and their prior convictions for drug-related offenses.
Judge Caproni said on Monday that she was "profoundly uncomfortable" with how
Whole Foods had treated Batts and Robinson, finding that there was
sufficient circumstantial evidence for a juror to conclude that a white former
supervisor, Jonathan Gass, discriminated against them based on their race. The
judge also refused to dismiss a claim that Gass engaged in defamation by
implying in emails to colleagues that Batts and Robinson had in fact sold
At the same time, Judge Caproni granted Whole Foods' motion to dismiss claims
that it discriminated against Batts and Robinson due to their prior convictions,
ruling that the plaintiffs had effectively "abandoned" those allegations in
recent court filings. The judge also threw out claims for slander and
retaliation, as well as a discrimination claim against Christina Minardi,
another former supervisor.
Michael Kors Reaches Deal To End 4K OT Claims In Calif.
Michael Kors Stores Inc. has agreed to pay $925,000 to settle a proposed class
action alleging the company cheated about 4,000 retail employees out of overtime
pay and meal breaks, according to a proposed settlement filed in California
federal court Friday.
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U.S. Retail Sales Fell 0.1% in February
Quarterly Same Store
H&M Q1 sales up 8%
Jamba Q4 system wide comp's up 3.9%, revenue down 55% (sold co. owned stores)
Neiman Marcus Q2 comp's down 2.4% with total revenue down 2.3%