BILL ANALYSIS                                                                                                                                                                                                    



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          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          1570 (Chang)


          As Amended  June 8, 2016


          Majority vote


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          |ASSEMBLY:  |78-0  |(May 12, 2016) |SENATE: | 37-0 |(August 11,      |
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          Original Committee Reference:  P. & C.P.


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


          The Senate amendments clarify the definition of a "dealer" of  
          collectibles to exclude:


          1)A licensed pawnbroker, provided that the pawnbroker does not  
            hold himself or herself out as having knowledge or skill  
            peculiar to collectibles.


          2)The personality who signs the memorabilia. 









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          3)A provider or operator of an online marketplace, provided that  
            the 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. 


          EXISTING LAW: 


          1)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, as specified.  (Civil Code (CC)  
            Section 1739.7(b))
          2)Requires each certificate of authenticity to do all of the  
            following: 


             a)   Describe the collectible and 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;


             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,  








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               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)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))


          FISCAL EFFECT:  None.  This bill is keyed non-fiscal by the  
          Legislative Counsel. 


          COMMENTS:  According to the author, there is widespread fraud in  
          the market for autographed collectibles:  "Experts estimate  
          that? 94% of all autographed Beatles memorabilia is forged, as  








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          are 76% of Marilyn Monroe and Elvis Presley collectibles.  In  
          the last twenty years, the FBI [Federal Bureau of Investigation]  
          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."


          Under existing law, dealers in signed sports memorabilia must  
          furnish a certificate of authenticity to the consumer at time of  
          sale.  The certificate provides the consumer with information  
          about the collectible and the dealer, as well as an express  
          warranty.  Dealers must also display at the sale site and in  
          advertisements a disclosure regarding the rights of the  
          consumer.  A consumer injured by an omitted or false certificate  
          may seek actual damages, a civil penalty in an amount equal to  
          10 times actual damages, plus court costs, reasonable attorney's  
          fees, interest, expert witness fees, and additional damages for  
          egregious conduct, incurred by the consumer in the action.   
          Dealers must have a valid resale certificate number from the  
          State Board of Equalization and be surety bonded or insured.


          This bill would expand those same protections to all forms of  
          signed collectibles, and also clarify that these protections  
          apply to collectibles offered for sale online. 


          Analysis Prepared by:                                             
                          Hank Dempsey / P. & C.P. / (916) 319-2200  FN:  
          0003642

















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