*1 486 defense, running its own Waukegan was request for de- the client’s
ly evaluate delay if the have asked for a and it could estoppel penalty is a In Illinois fense. Scottsdale with City provide wanted to protect to to induce insurers designed analyze the situation. The district risk, time to rather than to sit are at clients who City’s own unlikely tо treat the proceeds. judge was underlying suit idly while the obligation notice doctrine, comply failure with its pro- to penalty like the estoppel The indefinitely, postpone, to 155, good as a reason discourage to supposed visions Time away. than a week jury Yet trial less conduct. and vexatious unreasоnable schedule; judge’s unreasonably; had been reserved did not behave Scottsdale (which been notified and had rear- all the witnesses had days takes more than had) firm, testify. in to ranged their own lives order hire a law to time Scottsdale complex litigation delays policy, Last-minute complaint light analyze actеd appropriate. Scottsdale ap- are seldom obtain applicable research any had dispatch Waukegan all the supervisors, claims responsible proval sensibly judge the district right expect; to declaratory-judgment suit get cannot be liable for multiple held Scottsdale way. compаnies indemnity expenses review; need time either defense or layers bureaucracies Dominguez litigation. to act. Illi appellate courts of
The intermediate Affirmed concluded that Ehlco does nois have contending an insurer from
block that, acting diligent little time even
had so supplied a defense or
ly, it could not have declaratory judg
commenced a suit for underlying litigation
ment before See, judgment. e.g., State Auto
reached Kingsport Co. v. mobile Mutual Insurance STRAATEN, Natalie on behalf of VAN LLC, 946, Ill.Aрp.3d Development, 364 class, and a Plaintiff- herself N.E.2d 974 301 Ill.Dec. Respondent, (insurer time” in entitled to a “reasonable act); Northern Insur which to decide Chicago, ance New York v. Co. of OIL COMPANY SHELL PRODUCTS Ill.App.3d 259 Ill.Dec. LLC, LLC, Equilon Enterprises (2001) (no defend, duty N.E.2d Company, Oil Defendants-Peti- estoppel, give if the client does not tioners. opportunity рarticipate” “an insurer No. 11-8031. suit). underlying Waukegan asks us decisions, reject these but the of Appeals, United States Court place. of Illinois has left them Seventh Circuit. unlikely high think it that the state’s 4, 2012. Submitted Jan. Waukegan’s agree est court would
understanding April Ehlco. 2012. Decided City contends that Scottsdale by asking could have secured morе time the trial. judge postpone
the district odd;
That more than a little contention is *2 Bernstein, Attorney, Barack,
Mark Scott Ferrazzano, Nagelberg Kirschbaum & LLP, IL, Chicago, for Defendants-Peti- tioners. EASTERBROOK,
Before Judge, Chief MANION, CUDAHY Circuit Judges.
EASTERBROOK, Judge. Chief The Fair and Accurate Credit Transac Act, 1681c(g), requires 15 U.S.C. the truncation of credit-card numbers on electronically printed receipts. The re ceipt must not display “more than the last of the card number”. The statute does not define thе “card number”. interlocutory This appeal the dis —which trict court authorized under 28 U.S.C. 1292(b), see 2011 U.S. Dist. Lexis (N.D.Ill. Dec. 2011) presents — whether “card number” and “primary account number” are inter changeable. printed receipts Oil gas at its pumps last what Shell calls the customer’s “account number”. Natalie van Straaten contends printеd wrong that Shell four digits— that it should have printed the final four that are numbers encoded on magnetic stripe, the card’s a number the calls the num or PAN. ber” She does not contend that Shell chose to would have theft, prevention allowed of which (The goal is the behind the Act. call parties “FACTA,” prefer the statute but we sim initialisms.) ple words to awkward designates Shell Card nine Oberman, Martin Attorney, Chicago, J. the “account number” and five as the “card IL, Plaintiff-Respondent. number”. Here an illustration: *3 still the having digits), 14 embossed sample this still had used someone receipt sequence on the permissible station, at a Shell
Card
digits
be the last four or five
of
would
displayed
wоuld have
printed receipt
account num-
machine-readable
“6789”,
digit than the statute
one fewer
ber.
held,
but,
judge
the district
allows—
The Act does not define “card number”.
sequence
“0000” should
wrong digits.
and the
The Federal Trade Commission
card, the
printed
sample
for this
been
Bureau,
Financial
Consumer
Protection
denying
Shell’s mo-
judge concluded
authority
interpret the
which have some
summary judgment.
2011 U.S.
tion for
(§
part
Act
is
Reporting
Fair Credit
1681c
(N.D.I11.
2011).
Sept.
Lexis Dist.
statute),
have not defined the
of that
receipts looked like this:
Shell’s
The FTC’s staff did issue
“bulle-
term.
XXXXX
XXXXX6789
alerting
tin”
businesses to the
-Account Number-
-Card Number-
enactment,
soon after its
requirement
publication
not
lacks
dеfinition
this
they
should have
The district court held
effect;
it is
but also has
authoritative
looked like this:
an exercise in notice-and-comment
neither
XXXXXXXXX
X0000
of
rulemaking nor the outcome
administra-
-Card Number-
-Account Number-
(The bulletin,
much
adjudication.
tive
other advice issued
of the Commission’s
has 14
Shell Card
embossed
over to the
it handed enforcement
before
the front and 18
encoded
Bureau,
recapped
Experi-
in Years
fO
of
magnetic stripe.
18-digit primary
This
Act,
Reporting
ence with the Fair Credit
account number
could be
rendered
Report
Summary
an FTC
of
Staff
According to
123456789ABCDEFGHI.
2011).) But
Interpretations
(July
we need
court, only
van Straaten and the district
essay a
of “card
not
definition
number”
an
re-
or “EFGHI” on
electronic
“FGHI”
matter,
can’t see
original
an
because we
Act—no matter
ceipt complies with the
why anyone should care how
term
eyes
sequence
what
is accessible to the
not
precise
defined. A
definition does
physical imprint
of
machine
takes
too
long
receipt
matter as
as the
contains
the card.
If the number visible to
cus-
identity theft. The Act
few
to allow
(revers-
tomer
123 456 789
were ABCDE
by limiting the
of
does its work
number
“account
ing the order of
printed
one
exposed digits,
Shell Oil
above,
digit than the Act allows.
sample
“card number” on the
while
fewer
Plaintiff
repre-
pоsition
class she
insists that Shell’s
Straaten and the
can
Van
by analysis
do not
that Shell’s choice
revealed as
contend
unreasonable
sents
left them at risk
theft.
practices. When businesses
injury
have not
to suffer
They
claimed
to read credit-card numbers
started
elec-
In-
compensatory damages.
want
1980s,
tronically
dо
transmitting
them
provided by 15
they
penalty
seek the
stead
purchase’s
to financial institutions for each
1681n(a)(l)(A),
says
that a
U.S.C.
approval, they
a uniform
needed
format—
“willfully
comply”
who
fails
person
sequence
numbers
both
and a stan-
requirement
Fair Credit Re-
any
(and
encoding
potentially
encrypt-
dard
“any
amount of
Act is liаble in the
porting
ing) so
computers
could understand
*4
by
damages
the consumer
actual
sustained
work with them. The
International
damages of not
a result of the failure or
as
(ISO)
Organization for Standardization
$1,000”.
than
than
and not more
less
$100
up with a
that
came
format
can be read
everyone
who has
An award
$100
a
“swiped” through
card is
a termi-
a
station
Shell Card at a Shell
would
used
nal,
radio-frequency
or a
identification
billion,
the
despite
absence of a
exceed $1
(RFID) tag
brought
is
the card
close to
injury.
worth of
penny’s
near-field-eommunications
reader.
In
depend
§
on a
Penalties
1681n
this standard
the 18 or
digits
some of
19
being
“willful”. The
violation
designаte
the
in which the card’s
term,
§
defined that
1681n uses
issuer
the
participates, some
individual ac-
Burr,
it,
Co. v.
count, and at
is a
digit;
least one
check
47, 69, 127
167 L.Ed.2d
S.Ct.
U.S.
possible
also
is
to encode whether the card
(2007),
concluding
practice
that
is
original
the
replacement
or a
for one
willful
when “the action is
viola-
was lost or
еxpert
that
stolen. Plaintiffs
reading
tion under a reasonable
by reports
testified
deposi-
witnesses
terms,
that
compa-
but shows
the
statute’s
that
payment-card industry
the
un-
a risk of
the law substan-
ny
violating
ran
derstands “account number” and the ISO’s
greater than
associated with
tially
the risk
“primary account number” to be the same
reading
mеrely
that
was
careless.”
thing, and that
informed
lobbyists
congres-
words,
wrote, only a
other
the Justices
Congress
staff of this in 2003 when
sional
reading
“objectively
that is
unreasonable”
considering proposals that
was
led to
can
deemed a “willful” violation. Ibid.
view,
1681c(g).
§
since “everyone
On this
statutory or regulatory
The absence of а
1681e(g)
knows”
refers to the last
“card
phrase
definition
the
number”—
digits
or
the primary
five
account
the fact that
the four
Shell number, it was unreasonable for Shell to
greater
created no
exposed
receipt
the last four
of its
self-defined
for
printing
risk
its customers than
the
number,” digits
“account
that occur some-
primary
lаst four
account
where
the middle of a
account
can-
number —means that Shell’s decision
number” that
the ISO’s
meets
standards.
“objectively
called
unreasonable”.
not be
“Everyone
is no
U.S.A.,
knows”
substitute for
Hilfiger
Long
Tommy
v.
See
Cir.2012)
(3d
support
Legislative
in the text.
history
(printing
last 5
that “the
with the assertion
in this court
any receipt provid-
upon
date
cannot be
that willfulness
law is settled”
point
at the
ed to thе cardholder
must
summary judgment
but
decided
sale or transaction.
jury.
then cites
be submitted to
She
(2) Limitation
issued
district courts.
opinions
three
are not
of district courts
only to re- Yet decisions
apply
shall
This subsection
rendering
even within the
authoritative
printed,
that are
ceipts
any proposi
They cannot “settle”
in district.
apply to transactions
and shall not
not mention
tion. Plaintiff does
recording
the sole means
which
Safeco
Insurance,
num-
which
card account
credit card or debit
grant
the United States treated willfulness as a
petition
ap-
leave to
judgment
law and directed
peal. The decision of the district court is
in a
reversed,
be entered
defendant’s favor without a
and the case is remanded with
principal
trial. The
district-court decision instructions
judgment
to enter
for defen-
that van Straaten invokes rests its conclu dants.
Guaranty,
sion on
v. Radian
Whitfield
(3d
CUDAHY,
Cir.2007),
Judge,
Circuit
concurring.
501 F.3d
270-71
proposition
reads for the
join
I
without reservation the compre
disputes about willfulness must be submit
majority opinion
hensive
sepa
and write
jury.
to a
Searcy
Corp.,
ted
See
v. eFunds
rately only to comment briefly on the issue
3894165, *6-7,
2010 WL
at
Dist.
U.S.
of willfulness that is the sole basis of deci
(N.D.Ill.
Sept.
at *18-19
Lexis
sion here.
“Willfulness”
include reck
2010).
But
not
did not
Whitfield
lessness,
specifically
and that is
ques
discuss the fact that
Safeco
Burr,
tion hеre. See
Ins. Co. v.
(the
subject
treated the
one
law
47, 69,
U.S.
127 S.Ct.
167 L.Ed.2d
objective
standard concerns
rea
(2007);
see also
Long Tommy Hil
sonableness,
mind),
anyone’s
state of
U.S.A., Inc.,
(3d
figer
Long, as a
that printing
matter
statute. Plaintiff-Appellee, question complianсe submitted counsel, since, communica point, at one v. ruled inadmissible with counsel were BAHENA-NAVARRO, also Santos grounds privilege. Van Straaten Bahena, known as Santos Co., F.Supp.2d Oil Prods. Shell Defendant-Appellant. (N.D.Ill.2011). matter of Simply as a No. 11-1348. imagine procedure, is hard to normal compliance being submitted issue of Appeals, United States the advice sought counsel. Had Shell Seventh Circuit. statute, conforming counsel Argued Oct. 2011. immunity on that might claimed (although leaves undecided basis Decided 2012. April in the whether such claim could succeed case). at Safeco, of that 551 U.S. context However, 20, 127 S.Ct.
70 n. 2201. is not pursued the ease before us
issue immunity assign to whether
related statutory compliance the matter of
ing
non-lawyers might evidence of reckless course,
ness. Of rests objective inter reasonableness of the
pretation, which is demonstrated
majority opinion, credentials of and the evaluators irrelevant.
Shell’s are pursued
Because district court *7 allegedly
these various threads of defi- procedure by thereby
cient Shell—and surprising
created issues fact—it is not erroneously
that the district court denied
summary judgment prescribed jury However,
trial to determine willfulness.
in the absence of in risk of harm increase objec- finding
as demonstrated reasonableness, disposi-
tive latter
tive as a matter of law.