The Legal Landscape For Gift Cards

Since their commercial introduction by Blockbuster and Wal-Mart, "stored-value-cards" (SVCs), popularly known as "gift cards," have become a familiar part of our daily lives. Sales of gift cards are expected to exceed $72.8 billion this year, with close to $25 billion of those purchases made during the holiday season. Technological improvements have reduced the costs of administering an SVC program, allowing even small merchants to offer a private brand SVC. SVCs offer customers convenience and flexibility, while simultaneously providing issuing merchants with an additional avenue for marketing and a tool for collecting marketing data. The exploding popularity of SVCs has drawn the attention of state legislatures, federal regulators, and class-action lawyers, creating a complex regulatory landscape for companies that seek to exploit the public appetite for these cards...