Statutes Amended for Retailer’s Benefit

Over the years, states have come to recognize the exorbitant monetary losses that retailers suffer due to incidents of theft and one by one, states have enacted statutes allowing the retailer to request civil statutory damages and/or a civil penalty from shoplifters in addition to any restitution that may be owed.  These civil statutes, initially enacted to help the retailer defray the financial impact of shrink, partially offset the retailer’s security expenses and deter repeat offences, have evolved into an important way for retailers to recoup some of their losses from theft and in turn, help to keep prices down for the honest consumer.

In recent years, several states have amended these statutes in favor of the retailer, allowing for a greater recovery against the shoplifter.   For example, in 2009, the Washington State Senate realized the statute had remained unchanged since its establishment in 1975, a time when the dollar went a lot further.  The Senate pointed out that $250 in 1975 was equivalent to $954 in 2007; therefore, the monetary amount that was considered a sufficient recovery in 1975 was no longer sufficient in the 21st century.  As a result, Washington’s maximum civil penalty request (provided that the retail price of the merchandise is at the statutory maximum) was increased from $1,200 to $3,500 in addition to any restitution.[1] Maryland also revised its statute in 2001 when the House and Senate voted in favor of the amended bill with overwhelming support, 138-0 in the House and 47-0 in the Senate.  While calculation of the civil penalty remained at two times the retail value, the maximum allowable recovery was raised from $500 to $1,000 in addition to any restitution request.[2] Similarly, in 2006, in response to the rising costs of loss prevention, merchandise and court proceedings, the Retail Merchants Association requested a bill to raise the maximum allowable request in New Hampshire, which had remained unchanged since 1992.  The House and Senate voted in favor of amending the statute, increasing the maximum allowable request from $200 to $400 plus any restitution.[3] In 2010, the statute was changed again and “shoplifting” was replaced with “willful concealment,” the distinction being that in New Hampshire the act of willful concealment occurs within the boundary of the merchant’s premises while the act of shoplifting occurs outside that boundary.[4] While willful concealment had been previously referred to in the statute, deleting “shoplifting” reinforced the retailer’s right to make a civil damages request not only once a shoplifter has exited with unpurchased merchandise, but when he or she conceals unpurchased merchandise before or without exiting.

Not all recent amendments have favored the retailer, however.  There have also been some amendments that have negatively impacted the retailer’s request.  The latest being North Dakota which amended its statute to only allow a civil request for restitution and/or statutory damages upon completion of the criminal matter.  Therefore, if the police are called at the time of the incident and charges are pressed, no civil requests can be made until the criminal matter is resolved.  This differs from the majority of other statutes which state that a conviction or plea of guilty to the offense of theft is not a prerequisite to the bringing of a civil action.  Additionally, in 2009, the Arkansas statute was changed to apply only to adults, eliminating any juvenile or parental liability.  In 2006, Rhode Island, in a perplexing move, eliminated the availability to demand a civil penalty until a lawsuit has been filed.

For these reasons, it is vital for retailers to lobby each state’s legislature to stress the importance of these statutes and their value to the retail industry in helping to recoup a portion of the losses resulting from theft.  While some statutes have been amended in favor of the retailer, other amendments have disfavored the retailer and many statutes have not been amended at all.  It is important for retailers to work together in requesting that each state’s legislature revisit the civil theft statutes, amending them to allow a greater recovery against those that are the root cause of the loss.  We recommend that retailers unite to lobby for increased demand amounts where appropriate and to expand the scope of the civil theft statutes to include theft of cash, time card fraud, gift card fraud and other forms of employee theft.  Recent amendments benefitting the retailer have been overwhelmingly supported and just as the Retail Merchants Association in New Hampshire demonstrated, a request can go a long way in helping to grant retailers the utmost protections that the law can afford.