GameStop Fights Calif. Counties Over Pawn Law

By DEREK M. FLEMING

SACRAMENTO, Calif. (CN) – Video-game retailer GameStop sued the district attorneys of four California counties this week over what it calls illegal investigations into its stores’ sales of used games and consoles.

GameStop’s federal lawsuit against the DAs of Shasta, Contra Costa, Riverside and Tulare counties says law enforcement has violated search-and-seizure and due-process laws through the improper application of codes designed to regulate the sale of used property by pawn shops and secondhand sellers.

In its lawsuit, GameStop says the pawn-shop law doesn’t apply to its business, since it primarily sells new merchandise and the sale of used video games and consoles makes up only a small portion of its business. GameStop says the four DAs have failed to identify a single victim related to its sale of used merchandise.

State law requires secondhand sellers and pawn shops to register with the state Department of Justice. They’re also required to report any time they take in items bearing serial numbers or identifying information, take detailed personal information from the person bringing in the item – including a thumbprint – and must hold the item for 30 days for law enforcement to inspect.

Regulating sales of used video games and consoles to identify and apprehend thieves is a growing issue, as law enforcement has linked home burglaries and shoplifting to other criminal activity including drug use. The California Legislature enacted laws in 2012 to track and identify stolen merchandise received by pawn shops and secondhand sellers through a statewide system.

But GameStop says applying the secondhand-seller law to its business hampers its ability to do business and makes its customers feel like criminals. And the 30-day holding requirement means it can’t turn around its used inventory quickly or ship items that need to be refurbished to its Texas facility, the company says.

Meanwhile, the requirements for the sale of used games can vary from store to store depending on state and local laws. An employee at a GameStop in the Contra Costa County city of Pleasant Hill said in a phone interview that people selling or trading in used games or consoles must be 18 or older and have a valid state-issued ID. The store uses a digital fingerprint recorder, requires a signature and employees enter the information from the ID into the company system.

And according to GameStop’s website, the company does not accept multiple copies of the same video game from any one individual or any unopened items without a receipt in an effort to prevent taking in stolen video games and consoles. GameStop employees are trained to refuse any items they suspect are stolen.

GameStop spokesman Joey Mooring said the company does not comment on pending litigation.

Riverside County DA spokesman John Hall also declined to comment on the case. The other district attorneys did not return phone calls seeking comment by press time.

GameStop seeks a declaration that the secondhand sellers law does not apply to its business, and a finding that the law as applied violates its constitutional rights, the Commerce Clause and the California Constitution.

The company is represented by Benjamin Smith of Morgan, Lewis & Bockius in San Francisco.

 

 

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