Amended  IN  Assembly  April 24, 2017

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 228

Introduced by Assembly Members Gloria and Chiu
(Coauthors: Assembly Members Acosta, Baker, Chen, Mathis, Voepel, and Bonta)
(Coauthor: Senator Atkins)

January 26, 2017

An act to amend Section 1739.7 of the Civil Code, relating to collectibles.


LEGISLATIVE COUNSEL'S DIGEST


AB 228, as amended, Gloria. Collectibles: sale of autographed memorabilia.
Existing law regulates the sale or offer to sell by a dealer to a consumer of a collectible in or from this state, as specified. Existing law defines the term “collectible” to mean any autographed item, as specified, sold or offered for sale in or from this state by a dealer, to a consumer for $5 or more. Existing law defines the term “autographed” to mean bearing the actual signature of a personality signed by that individual’s own hand. Existing law defines a “dealer,” among other things, as a person who is principally in the business of selling or offering for sale collectibles in or from this state or a person who by his or her occupation holds himself or herself out as having knowledge or skill peculiar to collectibles. Existing law includes a person engaged in a cable television business for the sale of collectibles in the definition of dealer. Existing law excludes, among other persons, the personality who signs the memorabilia from the definition of dealer. Existing law also excludes from the definition of dealer a provider or operator of an online marketplace, provided that the marketplace provider or operator is not principally in the business of selling, or offering for sale, collectibles, in or from the state, exclusively or nonexclusively, or does not hold itself out as having knowledge or skill peculiar to collectibles.
This bill would define “principally” to mean that a majority of the number of inventory items offered or sold by a dealer are collectibles. The bill also would narrow the definition of collectible to mean an autographed sports or entertainment media item, as specified, sold or offered for sale in or from this state by a dealer to a consumer for $100 or more. The bill would amend the definition of autographed to mean bearing the actual signature of a person signed by that individual’s own hand that increases the sale value of the item over that of a comparable item without the actual signature. The bill would amend the definition of a dealer to be, among other things, a person who is principally in the business of selling collectibles and who also holds himself or herself out as having knowledge or skill peculiar to collectibles. sells or has sold 3 or more collectibles in either the current or the immediately preceding calendar year. The bill would include a person engaged in any television business for the sale of collectibles in the definition of dealer. The bill would exclude from the definition of dealer the person who autographed the collectible, instead of the personality who signs the memorabilia. The bill would amend the terms under which a provider or operator of an online marketplace is excluded from the definition of dealer to exclude a provider or operator that is not in the business of selling, or offering for sale, collectibles, in or from the state, exclusively or nonexclusively, and has not sold or does not sell 3 or more collectibles in either the current or the immediately preceding calendar year.
Existing law requires a dealer to provide a certificate of authenticity for each collectible to, among other things, indicate to a buyer whether a collectible item was purchased from a 3rd party and if so, the name and address of the 3rd party. Existing law requires a dealer displaying or offering for sale a collectible in this state to have at the location and in close proximity to the collectible merchandise a conspicuous sign that informs consumers of the written certificate of authenticity requirement, as specified. Existing law also requires a dealer engaged in a mail-order, telephone-order, or online business for the sale of collectibles in or from this state to, among other things, include in each television or online advertisement a similar disclosure in an onscreen message, as specified.
Existing law grants certain individuals the right to cancel or to rescind certain contracts within a specified number of business days. Existing law requires a retail seller that sells goods to the public in this state that has a policy as to any of those goods of not giving full refunds, or of not allowing equal exchanges, or any combination thereof, for at least 7 days following purchase of the goods, as specified, to conspicuously display that policy, as specified.
This bill, bill instead would instead, require a dealer to provide an express warranty, as specified. The bill also would require a dealer, for items obtained on and after January 1, 2018, separate from the certificate of authenticity, express warranty, to maintain a record stating whether the item was purchased by the dealer from a 3rd party and the name and address of the 3rd party. The bill would authorize this information to be disclosed by court order, as specified.
The bill would require a consumer to have the right to cancel the contract for the purchase of a collectible represented by a dealer as authentic until midnight of the 3rd day after the day on which the consumer purchased the collectible. The bill would specify procedures and conditions of the cancellation. The bill would require the 3-day right of return to be included in the sign and the onscreen message a dealer is required to display.
Existing law prohibits a dealer from displaying or offering for sale a collectible in this state at any trade show or similar event primarily featuring sales of collectibles or other memorabilia that offers onsite admission ticket sales, except as provided. Existing law requires a promoter who arranges or organizes a trade show featuring collectibles and autograph signings to provide a specified notification to any dealer who agrees to purchase or rent space in the trade show.
This bill would repeal those provisions.
Existing law provides that a consumer who is injured by a failure of the dealer to provide a certificate of authenticity is entitled to recover from that dealer, among other things, 10 times his or her actual damages.
This bill, bill instead would instead, require that a dealer be knowingly willful or negligent in failing to provide the certificate of authenticity express warranty in order for the penalties to apply.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NO   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 1739.7 of the Civil Code is amended to read:

1739.7.
 (a) As used in this section:
(1) “Autographed” means bearing the actual signature of a personality signed by that individual’s own hand. hand that increases the sale value of the item over that of a comparable item without the actual signature.
(2) “Collectible” means an autographed item sold or offered for sale in or from this state by a dealer to a consumer for five dollars ($5) or more. one hundred dollars ($100) or more of either of the following categories:
(A) Sports items, including, but not limited to, a photograph, book, ticket, plaque, sports program, trading card, item of sports equipment or clothing, or other sports memorabilia.
(B) Entertainment media items related to music, television, and films, including, but not limited to, a picture, photo, record, compact disc, digital video disc, ticket, program, playbill, clothing, hat, poster, toy, plaque, trading card, musical instrument, or other entertainment memorabilia.
(3) “Consumer” means any natural person who purchases a collectible from a dealer for personal, family, or household purposes. “Consumer” also includes a prospective purchaser meeting these criteria.
(4) (A) “Dealer” means a person who is principally in the business of selling or offering for sale collectibles in or from this state, exclusively or nonexclusively, and a person who by his or her occupation holds himself or herself out as having knowledge or skill peculiar to collectibles, or to whom that knowledge or skill may be attributed by his or her employment of an agent or other intermediary that by his or her occupation holds himself or herself out as having that knowledge or skill. sells or has sold three or more collectibles in either the current or the immediately preceding calendar year. “Dealer” includes an auctioneer who sells collectibles at a public auction, and also includes persons who are consignors or representatives or agents of auctioneers. “Dealer” includes a person engaged in a mail order, telephone order, online, or cable television business for the sale of collectibles.
(B) “Dealer” does not include any of the following:
(i) A pawnbroker licensed pursuant to Chapter 3 (commencing with Section 21300) of Division 8 of the Financial Code, if the collectible was acquired through a foreclosure on a collateral loan, provided that the pawnbroker does not hold himself or herself out as having knowledge or skill peculiar to collectibles.
(ii) The personality person who signs autographed the memorabilia. collectible.
(iii) A provider or operator of an online marketplace, provided that the online marketplace provider or operator is not principally in the business of selling, or offering for sale, collectibles, in or from the state, exclusively or nonexclusively, or does not hold itself out as having knowledge or skill peculiar to collectibles. and has not sold or does not sell three or more collectibles in either the current or the immediately preceding calendar year.

(5)“Description” means any of the following:

(A)Any representation in writing, including, but not limited to, a representation in an advertisement, brochure, catalog, flyer, invoice, sign, Internet Web page, email, or other commercial or promotional material.

(B)Any oral representation.

(C)Any representation included in a radio or television broadcast or online communication to the public in or from this state.

(6)

(5) “Limited edition” means any collectible that meets all of the following requirements:
(A) A company has produced a specific quantity of a collectible and placed it on the open market.
(B) The producer of the collectible has posted a notice, at its primary place of business, that it will provide any consumer, upon request, with a copy of a notice that states the exact number of a collectible produced in that series of limited editions.
(C) The producer makes available, upon request of a consumer, evidence that the electronic encoding, films, molds, or plates used to create the collectible have been destroyed after the specified number of collectibles have been produced.
(D) The sequence number of the collectible and the number of the total quantity produced in the limited edition are printed on the collectible.

(7)“Mint condition” means any collectible sold on the open market or through a private transaction that meets all of the following requirements:

(A)The item has never been circulated, used, or worn.

(B)The item exhibits little or no sign of aging or degradation caused by oxidation or exposure to sunlight as a result of its display.

(C)The item is otherwise free from creases, blemishes, or marks.

(8)“Promoter” means a person who arranges, holds, organizes, or presents a trade show featuring collectibles, autograph signings, or both.

(9)

(6) “Person” means any natural person, partnership, corporation, limited liability company, company, trust, association, or other entity, however organized.

(10)“Principally” means that a majority of the number of inventory items offered or sold by a dealer are collectibles.

(7) “Representation” means any oral or written representation, including, but not limited to, a representation in an advertisement, brochure, catalog, flyer, invoice, sign, radio or television broadcast, online communication, Internet Web page, email, or other commercial or promotional material.
(b) Whenever a dealer, in A dealer who, in selling or offering to sell to a consumer a collectible in or from this state, provides a description of that collectible as being autographed, the dealer makes a representation to a consumer that the collectible is authentic shall furnish a certificate of authenticity an express warranty, which may be included in the bill of sale or invoice, to the consumer at the time of sale. The certificate of authenticity shall be in writing, shall be signed by the dealer or his or her authorized agent, and shall specify the date of sale. The certificate of authenticity shall be in at least 10-point boldface type and shall contain the dealer’s true legal name and street address. The dealer shall retain a copy of the certificate of authenticity express warranty for not less than seven years. Each certificate of authenticity shall do all of the following: The express warranty shall meet all of the following criteria:
(1) Is written in at least 10-point type.
(2) Is signed by the dealer or his or her authorized agent, and contains the dealer’s true legal name, business street address, and the last four digits of the dealer’s seller’s permit account number from the State Board of Equalization.
(3) Specifies the date of sale and the purchase price.

(1)Describe

(4) Describes the collectible and specify specifies the name of the personality person who autographed it.

(2)Either specify the purchase price and date of sale or be accompanied by a separate invoice setting forth that information.

(3)Contain an express warranty, which shall be

(5) Expressly warrants the collectible as authentic, and that the warranty is conclusively presumed to be part of the bargain, of the authenticity of the collectible. This bargain. The warranty shall not be negated or limited by reason of the lack of words such as “warranty” or “guarantee” or because the dealer does not have a specific intent or authorization to make the warranty or because any statement relevant to the collectible is or purports to be, or is capable of being, merely the dealer’s opinion.

(4)Specify whether

(6) If the collectible is offered as one of a limited edition and, if so, specify edition, specifies (A) how the collectible and edition are numbered and (B) the size of the edition and the size of any prior or anticipated future edition, if known. If the size of the edition and the size of any prior or anticipated future edition is not known, the certificate warranty shall contain an explicit statement to that effect.

(5)Indicate

(7) Indicates whether the dealer is surety bonded or is otherwise insured to protect the consumer against errors and omissions of the dealer and, if bonded or insured, provide proof thereof.

(6)Indicate the last four digits of the dealer’s seller’s permit number from the State Board of Equalization.

(7)Indicate whether the item

(8) Indicates if the collectible has a certificate of authenticity from a third party, or if it was autographed in the presence of the dealer and specify the date and location of, and the name of a witness to, the autograph signing. dealer, and any proof thereof.

(8)Include

(9) Indicates an identifying serial number that corresponds to an identifying number printed on the collectible item, if any. The serial number shall also be printed on the sales receipt. If the sales receipt is printed electronically, the dealer may manually write the serial number on the receipt.
(c) Separate from the certificate of authenticity, express warranty whenever selling or offering to sell an autographed a collectible in or from the state that was obtained by the dealer on or after January 1, 2018, the dealer shall maintain a record stating whether the item was purchased by the dealer from a third party and the name and address of the third party. This third-party information may be disclosed in the event of a civil dispute pursuant to a court order, subject to the privacy protections under Section 1798.90.

(d)A dealer shall not represent an item as a collectible if it was not autographed by the personality in his or her own hand.

(d) In addition to any other right or remedy, a consumer shall have the right to cancel the contract for the purchase of a collectible represented by a dealer as authentic until midnight of the third day after the day on which the consumer purchased the collectible. Notice of the cancellation may be provided in person or in a written or electronic form, and is deemed effective once communicated or sent. The collectible shall be returned to the dealer within 30 days of the sale in the same condition in which it was sold, the cost of which shall be borne by the consumer. The price paid by the consumer shall be refunded within 10 days of receipt of the returned collectible.
(e) No dealer shall display or offer for sale a collectible in this state unless, at the location where the collectible is offered for sale and in close proximity to the collectible merchandise, there is a conspicuous sign that reads as follows:
“SALE OF AUTOGRAPHED MEMORABILIA: AS REQUIRED BY LAW, A DEALER WHO SELLS TO A CONSUMER ANY MEMORABILIA DESCRIBED AS BEING AUTOGRAPHED MUST PROVIDE A WRITTEN CERTIFICATE OF AUTHENTICITY EXPRESS WARRANTY AT THE TIME OF SALE. SALE AND A THREE-DAY RIGHT OF RETURN. THIS DEALER MAY BE SURETY BONDED OR OTHERWISE INSURED TO ENSURE THE AUTHENTICITY OF ANY COLLECTIBLE SOLD BY THIS DEALER.”
(f) Any dealer engaged in a mail-order, telephone-order, or online business for the sale of collectibles in or from this state:
(1) Shall include the disclosure specified in subdivision (d), (e), in type of conspicuous size, in any written advertisement relating to a collectible.
(2) Shall include in each television or online advertisement relating to a collectible the following written on-screen onscreen message, which shall be prominently displayed, easily readable, and clearly visible for no less than five seconds, and which shall be repeated for five seconds once during each four-minute segment of the advertisement following the initial four minutes:
“A written certificate of authenticity express warranty is provided with each autographed collectible, as required by law. This dealer may be surety bonded or otherwise insured to ensure the authenticity of any collectible sold by this dealer.”
(3) Shall include as part of the oral message of each radio advertisement for a collectible the disclosure specified in subdivision (d). (e).

(g)No dealer shall display or offer for sale a collectible in this state at any trade show or similar event primarily featuring sales of collectibles or other memorabilia that offers onsite admission ticket sales unless, at each onsite location where admission tickets are sold, there is prominently displayed a specimen example of a certificate of authenticity.

(h)

(g) Any consumer injured by a dealer’s knowingly willful or negligent furnishing of a certificate of authenticity an express warranty that is false, shall be entitled to recover, in addition to actual damages, a civil penalty in an amount equal to 10 times actual damages, plus court costs, reasonable attorney’s fees, interest, and expert witness fees, if applicable, incurred by the consumer in the action. The court, in its discretion, may award additional damages based on the egregiousness of the dealer’s conduct. The remedy specified in this section is in addition to, and not in lieu of, any other remedy that may be provided by law.

(i)

(h) No person shall represent himself or herself as a dealer in this state unless he or she possesses a valid resale certificate number seller’s permit from the State Board of Equalization.

(j)

(i) A dealer may be surety bonded or otherwise insured for purposes of indemnification against errors and omissions arising from the authentication, sale, or resale of collectibles.

(k)Whenever a promoter arranges or organizes a trade show featuring collectibles and autograph signings, the promoter shall notify, in writing, any dealer who has agreed to purchase or rent space in this trade show what the promoter will do if any laws of this state are violated, including the fact that law enforcement officials will be contacted when those laws are violated. This notice shall be delivered to the dealer, at his or her registered place of business, at the time the agreement to purchase space in the trade show is made. The following language shall be included in each notice:

“As a vendor at this collectibles trade show, you are a professional representative of this hobby. As a result, you will be required to follow the laws of this state, including laws regarding the sale and display of collectibles, as defined in Section 1739.7 of the Civil Code, forged and counterfeit collectibles and autographs, and mint and limited edition collectibles. If you do not obey the laws, you may be evicted from this trade show, be reported to law enforcement, and be held liable for a civil penalty of 10 times the amount of damages.”