In a landmark privacy ruling, the Supreme Court of California has stated that an individual’s zip code is now personal information and is therefore protected under privacy laws. According to the court, the decision was primarily made because of the power of zip codes to detect a consumer’s address. As privacy advocates know, a point-of-sale credit or debit card transaction, along with a user’s zip code, can easily be used to pinpoint the payee’s address.

Standard operating procedure for businesses requesting a zip code at the register is to enter it into the electronic cash register and then complete the transaction. At the end of the transaction, the merchant has the customer’s credit card number, name, and ZIP code recorded in a database. At this point, the merchant has the capacity to use customized computer software to search databases containing millions of names, e-mail addresses, telephone numbers, and street addresses, indexed in a manner resembling a reverse phone book. The software allows the merchant to take the consumer’s name, credit card information, and zip code and find a previously undisclosed home address, which the merchant can then add to their own database. This allows the merchant to send mailers to the home address without ever being provided with it. California courts saw this as violating the Credit Card Act of 1971, which was designed to protect consumers’ personally identifying information.

This ruling has widespread implications across California. While it forces merchants to change their information-gathering practices within the State of California, and may briefly impact the distribution of unsolicited marketing materials, it impacts more than just retailers trying to send advertisements to customers’ homes. For example, gas stations ask for zip codes at the pump to deter and detect fraud. Also, some retailers collect zip codes without linking them to a private address for the purpose of deciding where to build new stores. Whether the ruling will cause privacy laws to be amended and whether other states will follow suit is yet to be seen.

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