BILL ANALYSIS                                                                                                                                                                                                    Ó




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          |SENATE RULES COMMITTEE            |                       AB 1570|
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                                      CONSENT 


          Bill No:  AB 1570
          Author:   Chang (R), et al.
          Amended:  6/8/16 in Senate
          Vote:     21 

           SENATE BUS., PROF. & ECON. DEV. COMMITTEE:  9-0, 6/13/16
           AYES:  Hill, Bates, Block, Gaines, Galgiani, Hernandez,  
            Jackson, Mendoza, Wieckowski

           SENATE JUDICIARY COMMITTEE:  7-0, 6/28/16
           AYES:  Jackson, Moorlach, Anderson, Hertzberg, Leno, Monning,  
            Wieckowski

           ASSEMBLY FLOOR:  78-0, 5/12/16 (Consent) - See last page for  
            vote

           SUBJECT:   Collectibles:  sale of autographed memorabilia


          SOURCE:    Author


          DIGEST:  This bill requires dealers who advertise and sell any  
          type of autographed collectible to provide a certificate of  
          authenticity to the purchaser and generally expands a variety of  
          consumer protections that currently only apply to autographed  
          sports memorabilia to cover all such collectibles.  


          ANALYSIS:  


          Existing law:










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           1) Regulates the sale or offer to sell by a dealer to a  
             consumer of a sports collectible in or from this state.   
             (Civil Code (CC) § 1739.7)


           2) Requires a dealer, in selling or offering to sell to a  
             consumer an autographed sports collectible in or from this  
             state, to furnish a certificate of authenticity to the  
             consumer at the time of sale.  The certificate of  
             authenticity must be in writing, be signed by the dealer or  
             his or her authorized agent, specify the date of sale, be in  
             at least 10-point boldface type and contain the dealer's true  
             legal name and street address.  The dealer must retain a copy  
             of the certificate of authenticity for at least seven years.   
             (CC § 1739.7(b))


           3) Requires each certificate of authenticity to do all of the  
             following: 


              a)    Describe the collectible and specify the name of the  
                sports personality who autographed it;


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


              c)    Contain an express warranty, which shall be  
                conclusively presumed to be part of the bargain, of the  
                authenticity of the collectible, as specified;


              d)    Specify whether the collectible is offered as one of a  
                limited edition and, if so, specify how the collectible  
                and edition are numbered; and the size of the edition and  
                the size of any prior or anticipated future edition, as  
                specified;










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              e)    Indicate 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;


              f)    Indicate the last four digits of the dealer's resale  
                certificate number from the State Board of Equalization;


              g)    Indicate whether the item 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;


              h)    Indicate whether the item was obtained or purchased  
                from a third party, and the name and address of this third  
                party, if applicable; and


              i)    Include an identifying serial number that corresponds  
                to an identifying number printed on the collectible item,  
                if any, which shall also be printed on the sales receipt.   
                (CC § 1739.7(b))


           1) Prohibits a dealer from representing an item as a  
             collectible if it was not autographed by the sports  
             personality in his or her own hand.  (CC § 1739.7(c))


           2) Prohibits a dealer from displaying or offering for sale a  
             collectible in this state unless he or she displays a  
             conspicuous sign at the location where the collectible is  
             offered for sale and in close proximity to the collectible  
             merchandise, as specified.  (CC § 1739.7(d))





           3) Requires any dealer engaged in a mail-order or  








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             telephone-order business for the sale of collectibles in or  
             from this state to make specified disclosures in any written,  
             radio or televised advertisement.  (CC § 1739.7(e)) 


           4) 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 sports  
             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.  (CC § 1739.7(f))


           5) Entitles any consumer injured by the failure of a dealer to  
             provide a valid certificate 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, plus  
             additional damages based on the egregiousness of the dealer's  
             conduct.  (CC § 1739.7(g))


           6) Prohibits a person from representing himself or herself as a  
             dealer in this state unless he or she possesses a valid  
             resale certificate number from the State Board of  
             Equalization.  (CC § 1739.7(h))


           7) Requires a promoter arranging or organizing a trade show  
             featuring collectibles and autograph signings to notify in  
             writing any dealer who has agreed to purchase or rent space  
             in this trade show as to their legal responsibilities, as  
             specified.  (CC § 1739.7(j))


          This bill:


          1) Expands existing consumer protections and requirements  
             pertaining to the trade in autographed sports collectibles,  
             including specified requirements for a certificate of  








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             authenticity and dealer disclosures, by deleting the  
             reference to "sports", thereby making the existing provisions  
             apply to all autographed collectibles.


          2) Expands the definition of a "collectible" to mean any  
             autographed item sold or offered for sale in or from this  
             state by a dealer to a consumer for five dollars ($5) or  
             more.


          3) Revises the definition of "dealer" to any person who is  
             principally in the business of selling or offering for sale  
             collectibles in or from this state.


          4) Expands the definition of a "dealer" to include a person  
             engaged in an online business for the sale of collectibles.


          5) Excludes from the definition of a "dealer" a licensed  
             pawnbroker 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. 


          6) Excludes from the definition of a "dealer" the personality  
             who signs the memorabilia.


          7) Excludes from the definition of "dealer" an 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 this  
             state, exclusively or nonexclusively, or does not hold itself  
             out as having knowledge or skill peculiar to collectibles. 


          8) Expands the definition of "description" to include  
             representations on an Internet Web page or in an email, or a  
             representation in an online communication to the public in or  








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             from California. 


          9) Makes other technical or clarifying amendments. 


          Background   


          According to the author, there is widespread fraud in the market  
          for autographed collectibles, "Experts estimate that?94 percent  
          of all autographed Beatles memorabilia is forged, as are 76  
          percent of Marilyn Monroe and Elvis Presley collectibles.  In  
          the last twenty years, the FBI instituted two major  
          investigations uncovering millions in forged sports,  
          entertainment and historical autographed memorabilia - both  
          cases involved operations in California.  During the most recent  
          investigation, the FBI estimated forged memorabilia 'comprises  
          between $500,000,000 and $900,000,000' of the overall market.


          "As recently as 2015, the widow of The Jimi Hendrix Experience  
          drummer Mitch Mitchell warned that many items sold online that  
          purported to have been signed by Jimi Hendrix were really fake.   
          While Star Wars icon Mark Hamill took to Twitter to tell fans  
          which of their signed collectibles were forged and which were  
          genuine."


          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:NoLocal:    No


          




          SUPPORT:   (Verified7/12/16)


          California Police Chiefs Association 








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          Consumer Federation of California
          Genuine COA
          Motion Picture Association of America, Inc.
          Screen Actors Guild-American Federation of Television and Radio  
            Artists, AFL-CIO
          One individual


          OPPOSITION:   (Verified7/12/16)


          None received


          ARGUMENTS IN SUPPORT:     Supporters state that forged  
          autographs are estimated to account for $100 million of the  
          approximately $1 billion per year autographed memorabilia market  
          in the United States.  According to the Motion Picture  
          Association of America, Inc., this bill is consistent with  
          efforts to protect motion pictures and television from theft and  
          to ensure the integrity of these high value productions for the  
          benefit of viewers and consumers.

          ASSEMBLY FLOOR:  78-0, 5/12/16
          AYES:  Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,  
            Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Calderon,  
            Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper,  
            Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines,  
            Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson,  
            Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger  
            Hernández, Holden, Irwin, Jones, Kim, Lackey, Levine, Linder,  
            Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina,  
            Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen,  
            Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago,  
            Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber,  
            Wilk, Williams, Wood, Rendon
          NO VOTE RECORDED:  Burke, Jones-Sawyer


          Prepared by:Mark Mendoza / B., P. & E.D. / (916) 651-4104
          7/29/16 10:48:57









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