Amended in Assembly March 28, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 2368

Introduced by Assembly Member Wagner

February 21, 2014

An act to begin delete amend Section 3294 of the Civil Code, relating to civil actions end delete begin insert amend Section 1739.7 of the Civil Code, relating to autographed sports memorabilia end insert .

LEGISLATIVE COUNSEL’S DIGEST

AB 2368, as amended, Wagner. begin delete Civil actions: damages. end delete begin insert Civil law: obligations: sports memorabilia. end insert

begin insert

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 an autographed sports item, as specified, sold or offered for sale in or from this state by a dealer to a consumer for $5 or more.

end insert begin insert

This bill would revise the definition of “collectible” by increasing the price of the sports item sold or offered for sale to $15 or more. The bill also would make various technical, nonsubstantive changes to these provisions.

end insert begin delete

Existing law authorizes the plaintiff, in an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, to recover damages for the sake of example and by way of punishing the defendant in addition to the actual damages.

end delete begin delete

This bill would make technical, nonsubstantive changes to this provision.

end delete

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

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

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begin insert SECTION 1. end insert   

end insert

begin insert Section 1739.7 of the end insert begin insert Civil Code end insert begin insert is amended to
read: end insert

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.

(2) “Collectible” means an autographed sports item, including,
but not limited to, a photograph, book, ticket, plaque, sports
program, trading card, item of sports equipment or clothing, or
other sports memorabilia sold or offered for sale in or from this
state by a dealer to a consumer for begin delete five dollars ($5) end delete begin insert fifteen dollars
($15) end insert or more.

(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) “Dealer” means a person who is in the business of selling
or offering for sale collectibles in or from this state, exclusively
or nonexclusively, or 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. “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, or
cable television business for the sale of collectibles.

(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, or other commercial or promotional material.

(B) Any oral representation.

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

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

(b) Whenever a dealer, 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 shall furnish a
certificate of authenticity 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 for not less than seven years. Each certificate of
authenticity shall do all of the following:

(1) Describe the collectible and specify the name of the sports
personality 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 conclusively
presumed to be part of the bargain, of the authenticity of the
collectible. This 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 the collectible is offered as one of a limited
edition and, if so, specify (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 shall contain an explicit statement to that effect.

(5) 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.

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

(7) 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.

(8) Indicate whether the item was obtained or purchased from
a third party. If so, indicate the name and address of this third
party.

(9) Include 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) No dealer shall represent an item as a collectible if it was
not autographed by the sports personality in his or her own hand.

(d) 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 SPORTS MEMORABILIA: AS
REQUIRED BY LAW, A DEALER WHO SELLS TO A
CONSUMER ANY SPORTS MEMORABILIA DESCRIBED
AS BEING AUTOGRAPHED MUST PROVIDE A WRITTEN
CERTIFICATE OF AUTHENTICITY AT THE TIME OF SALE.
THIS DEALER MAY BE SURETY BONDED OR OTHERWISE
INSURED TO ENSURE THE AUTHENTICITY OF ANY
COLLECTIBLE SOLD BY THIS DEALER.”

(e) Any dealer engaged in a mail-order or telephone-order
business for the sale of collectibles in or from this state:

(1) Shall include the disclosure specified in subdivision (d), in
type of conspicuous size, in any written advertisement relating to
a collectible.

(2) Shall include in each television advertisement relating to a
collectible the following written begin delete on-screen end delete begin insert onscreen end insert 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 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).

(f) 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 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.

(g) Any consumer injured by the failure of a dealer to provide
a certificate of authenticity containing the information required by
this section, or by a dealer’s furnishing of a certificate of
authenticity 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.

(h) No person shall represent 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.

(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.

(j) Whenever a promoter arranges or organizes a trade show
featuring collectibles and autograph signings, the promoter shall
notify begin delete , in writing, end delete any dealer who has agreed to purchase or rent
space in this trade show begin insert , in writing, of end insert 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.”

begin delete

SECTION 1.  

Section 3294 of the Civil Code is amended to
read:

3294.  

(a) In an action for the breach of an obligation not arising
from contract, where it is proven by clear and convincing evidence
that the defendant has been guilty of oppression, fraud, or malice,
the plaintiff, in addition to the actual damages, may recover
damages for the sake of example and by way of punishing the
defendant.

(b) An employer shall not be liable for damages pursuant to
subdivision (a), based upon acts of an employee of the employer,
unless the employer had advance knowledge of the unfitness of
the employee and employed him or her with a conscious disregard
of the rights or safety of others or authorized or ratified the
wrongful conduct for which the damages are awarded or was
personally guilty of oppression, fraud, or malice. With respect to
a corporate employer, the advance knowledge and conscious
disregard, authorization, ratification or act of oppression, fraud,
or malice must be on the part of an officer, director, or managing
agent of the corporation.

(c) As used in this section, the following definitions shall apply:

(1) “Malice” means conduct that is intended by the defendant
to cause injury to the plaintiff or despicable conduct that is carried
on by the defendant with a willful and conscious disregard of the
rights or safety of others.

(2) “Oppression” means despicable conduct that subjects a
person to cruel and unjust hardship in conscious disregard of that
person’s rights.

(3) “Fraud” means an intentional misrepresentation, deceit, or
concealment of a material fact known to the defendant with the
intention on the part of the defendant of thereby depriving a person
of property or a legal right or otherwise causing injury.

(d) Damages may be recovered pursuant to this section in an
action pursuant to Chapter 4 (commencing with Section 377.10)
of Title 3 of Part 2 of the Code of Civil Procedure based upon a
death that resulted from a homicide for which the defendant has
been convicted of a felony, whether or not the decedent died
instantly or survived the fatal injury for some period of time. The
procedures for joinder and consolidation contained in Section
377.62 of the Code of Civil Procedure shall apply to prevent
multiple recoveries of punitive or exemplary damages based upon
the same wrongful act.

(e) The amendments to this section made by Chapter 1498 of
the Statutes of 1987 apply to all actions in which the initial trial
has not commenced prior to January 1, 1988.

end delete