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California AB 1570’s Impact: Confusion, Cost, and Correction?

by Jennifer Aguilar | Jan 19, 2017

In its previous session, the California legislature passed AB 1570, which requires individuals who are “principally in the business of selling or offering for sale collectibles” to provide consumers with detailed certificates of authenticity when they sell an autographed item. This applies both to sales entirely within California, as well as those made by California dealers to persons residing outside of the state. The original legislation had previously only been applied to sports related memorabilia, but those specific references were removed in AB 1570.

Where confusion has arisen is the extent to which this law now applies to items such as fine art multiples, author-signed books, and other signed items that fall outside the traditional idea of memorabilia. Indeed, the analysis provided by legislative counsel indicated that the law “would instead define the term ‘collectible’ to mean all autographed items”. However, the law’s author – who has since left the Legislature – wrote a letter indicating that she did not intend the legislation to apply to booksellers who occasionally sell signed copies of books. While such letters of intent are not viewed as dispositive by California courts, the statement by the former Assemblywoman only muddled the issue further.

As a threshold matter, the law only applies where:
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.

This means that appraisers who are primarily in the business of appraising – and do not make the majority of their revenue from the sale of signed items – are likely exempt from the law’s ambit. Moreover, there is nothing within the law that requires or compels an individual to obtain an appraisal of a signed item. Finally, the law only provides the consumer with a specific remedy (ten times actual damages, plus costs and any additional judicial award), and does not appear to provide appraisers who rely on these certificates and later discover them to be false or misleading with a cause of action under this law. ASA encourages appraisers who are unsure about whether or not AB 1570 applies to them to seek appropriate legal counsel.