SACRAMENTO, Calif. – On Oct. 12, Governor Jerry Brown signed Assembly Bill 228 into law, immediately reducing impediments to auction companies doing business in California. AB 228 corrects the problems created by provisions in AB 1570 (Chang) [Ch. 258, Stat. 2016], Signed Memorabilia. AB 228 was authored by Assembly Member Todd Gloria (D-San Diego) and Senator Cathleen Galgiani D-Stockton).
Last year AB 1570 (Chang), enacted new provisions in Section 1739.7 of the California Civil Code, effective January 1, 2017. The amendments were intended to rigorously govern the sale of “autographed” sports and entertainment memorabilia by requiring dealers who advertise and sell any item bearing a signature to provide a certificate of authenticity to the purchaser. That measure also required various onerous practices and procedures relating to record maintenance and disclosures of the identity of consignors of such “autographed” items, the latter of which raised privacy and confidentiality concerns. Severe civil penalties (up to 10 times actual damages, or more, plus legal fees and costs to a successful claimant) could be applied to anyone violating the statute.
The language of AB 1570 severely impacted entities that are not, or are only minimally, engaged in the sale of sports and entertainment memorabilia and that were and are not the intended focus of the statute, thereby unintentionally hindering commercial activity in the state of California. The breadth and vagueness posed by AB 1570 is what compelled the enactment of AB 228.
AB 228 corrects last year’s enacted statute as follows:
• Revises the definitions of “Collectibles” so as to more clearly target “Sports and Entertainment” collectibles, and excludes items like signed works of fine art, furniture, decorative objects, jewelry, books and manuscripts; and numismatic items or bullion, not intended by the author of AB 1570 to be included within the statute’s reach;
• Addresses the privacy and confidentiality issues created by AB 1570, by striking the provisions that require the disclosure of the name and address of consignors of goods and instead requires the dealer to retain records of the name and address of the third party for a period of seven years, during which time a consumer may seek such records pursuant to a subpoena or judicial order;
• Declares the intent of the Legislature that nothing in AB 228 shall be construed to affect the decision of the Court of Appeal in Gentry v. eBay, Inc. (2002) 99 Cal.App.4th 816; excluding providers or operators of an online marketplace; and
AB 228 contained an urgency clause, so the provisions in AB 228 go into effect immediately.
The coalition that spent the past 12 months fighting the restrictive provisions of AB 1570 included: Abell Auction Co., Bonhams, Clars Auction Gallery, LiveAuctioneers.com, Michaan’s Auctions and the associated company Antiques By The Bay.