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SB-579 Collectibles: sale of autographed memorabilia.(2017-2018)

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Date Published: 03/29/2017 09:00 PM
SB579:v98#DOCUMENT

Amended  IN  Senate  March 29, 2017

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Senate Bill No. 579


Introduced by Senator Galgiani
(Coauthors: Senators Anderson, Bates, Hertzberg, Pan, and Wilk)

February 17, 2017


An act to amend Section 1739.7 of the Civil Code, relating to collectibles, and declaring the urgency thereof, to take effect immediately.


LEGISLATIVE COUNSEL'S DIGEST


SB 579, as amended, Galgiani. Collectibles: sale of autographed memorabilia.
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 any autographed item, as specified, sold or offered for sale in or from this state by a dealer, to a consumer for $5 or more.
This bill would exclude from the definition of “collectible” items that are works of original art or numbered multiples signed by the artist or maker, as specified. that fall within one of 5 categories, including works of fine art, as defined.
Existing law defines a “dealer,” among other things, as a person who is principally in the business of selling or offering for sale collectibles in or from this state, a person who by his or her occupation holds himself or herself out as having knowledge or skill peculiar to collectibles, or a person who is a consigner or a representative or an agent of auctioneers who sell collectibles at public auctions.
This bill would exclude from the definition of a “dealer” an auction house or auctioneer that principally conducts sales of collectibles and any person or business that would be a dealer but for the fact that the person or business conducts business outside of California and nonexclusively transacts business with California purchasers. otherwise meet the definition of a “dealer” but who is located outside of this state and who sells, or offer, to sell, a collectible outside of the state, as provided.
Existing law requires a dealer to provide a certificate of authenticity for each collectible to, among other things, indicate whether the item was obtained or purchased from a third party. If the item was obtained or purchased from a third party, existing law requires the certificate of authenticity to indicate the name and address of this third party.
This bill would eliminate the requirement that the name and address of the third party be indicated on the certificate of authenticity and would, instead, provide that a dealer is not obligated to provide the name and address of a third party, unless litigation ensues related to that item, and, in that instance, would authorize a consumer to obtain that information pursuant to a subpoena or judicial order. The bill would require the dealer to retain records of the name and address of the third party, as specified. party for a specified amount of time.
This bill would declare that it is to take effect immediately as an urgency statute.
Vote: 2/3   Appropriation: NO   Fiscal Committee: NO   Local Program: NO  

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


SECTION 1.

 Section 1739.7 of the Civil Code is amended to read:

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) (A) “Collectible” means an autographed item sold or offered for sale in or from this state by a dealer to a consumer for five dollars ($5) or more.
(B) “Collectible” does not include items that are works of original art or numbered multiples signed by the artist or maker, including, but not limited to, any of the following: the following:

(i)Paintings.

(ii)Prints, including etching, woodcut, silkscreen, and other means of reproduction.

(iii)Works on paper.

(iv)Sculptures.

(i) Works of fine art, as defined by paragraph (1) of subdivision (d) of Section 982 that are originals or numbered multiples signed by the artist or maker.

(v)

(ii) Furniture and decorative objects, including works of pottery, jewelry, and design. design that are signed by the artist or maker.

(vi)Books

(iii) Signed books and manuscripts.
(iv) Signed numismatic items and bullion.
(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) (A) “Dealer” means a person who is principally 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, online, or cable television business for the sale of collectibles.
(B) “Dealer” does not include any of the following:
(i) A pawnbroker licensed pursuant to Chapter 3 (commencing with Section 21300) of Division 8 of the Financial Code, 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.
(ii) An auction house company or auctioneer that principally conducts sales of collectibles. is governed by Title 2.95 (commencing with Section 1812.600).
(iii) The personality who signs the memorabilia.
(iv) A provider or 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 the state, exclusively or nonexclusively, or does not hold itself out as having knowledge or skill peculiar to collectibles.
(v) Any person or business that would be a dealer but for the fact that the person or business conducts business outside of California and nonexclusively transacts business with California purchasers. that satisfies the criteria set forth in subparagraph (A), but who is located outside of this state and who sells, or offers, to sell, a collectible outside of the state. For purposes of this section, a dealer shall not include any person or business that conducts a sale or transaction that is completed outside of this state, including a sale or transaction that involves a purchaser who is a resident of California.
(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, Internet Web page, email, or other commercial or promotional material.
(B) Any oral representation.
(C) Any representation included in a radio or television broadcast or online communication 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 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, the The dealer is not obligated to provide the name and address of a third party, unless litigation ensues related to that item. In that instance, the consumer may obtain the name and address pursuant to a subpoena or judicial order. The dealer shall retain records of the name and address of the third party for a period of at least seven years, during which time a consumer may request the records pursuant to a subpoena or judicial order. years.
(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) A dealer shall not represent an item as a collectible if it was not autographed by the 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 MEMORABILIA: AS REQUIRED BY LAW, A DEALER WHO SELLS TO A CONSUMER ANY 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, telephone-order, or online 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 or online advertisement relating to a collectible the following written on-screen 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 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, in writing, any dealer who has agreed to purchase or rent space in this trade show 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.”

SEC. 2.

 This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the California Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to alleviate some of the burdens on, and to protect the privacy of, bookstore owners, comic book retailers, consignors, art galleries, antique dealers, and auction houses as soon as possible, it is necessary that this act take effect immediately immediately.