May 30, 2023

LAWSUIT: PSA Grading Service Sued For Grading Altered, Trimmed Cards

Professional Sports Authenticator (PSA) has been hit with a class action lawsuit by a baseball card collector who claims that the appraisal company knowingly graded altered cards and sold them at auctions.

Plaintiff Eric Savoy, a baseball card collector says that he has sent his own baseball cards to PSA for grading and has bought graded cards from the company.

In fact, he believes that he has purchased at least one graded card despite the fact that it was altered.

According to the plaintiff, a card owner sends a card to PSA in order to get a rating for that card. PSA will then determine if a card is “authentic and unaltered.” If the company determines that the card is authentic, it will grade the card on a 1-10 scale, based on its physical condition. If the company finds out that the card is altered, it will not grade the card on the 1-10 scale.

The plaintiff maintains that the PSA grade will have a direct impact on the market value of the card and that a “step up” of one or two grade could increase a card’s value tenfold, depending on the value of the card.

“Contrary to its guarantees to consumers, PSA in fact graded a substantial number of altered cards on its 1-10 scale,” the PSA class action lawsuit alleges.

The plaintiff maintains that PSA knew that cards were altered when it gave them the grades on the 1-10 scale. The plaintiff states that the altered cards were then sold with their newly inflated ratings and, in July 2019, The Washington Postreported that collectors had identified $1.4 million in the sale of altered cards.

In fact, the Washington Post points to a Stan Musial card from 1952 which reportedly had a spray black print mark on a white frame and sold for $2,800 in late 2017. The article notes that, seven months later, another 1952 Stan Musial card without that print mark was sold for $28,100.  Collectors are claiming that the two cards are the same item, which was allegedly altered to remove the blemish, thus inflating its value.

According to the class action lawsuit, other altered cards have stains removed and creases smoothed out in order to increase their value. Sometimes the cards are “trimmed” to create a gap between the card and the edge of the case in which it was placed, the plaintiff alleges.  In addition, each card reportedly has its own distinctive characteristics such as how the image on the card is centered in the frame as well as patterns on the fibers on the cards which collect dirt or other debris. The altering of these aspects of the cards could result in a card getting a better grade than it actually deserves, the plaintiff maintains.

“Indeed, collectors were able to use PSA’s records to uncover the scheme, yet PSA contends that it continued to grade altered cards without noticing from its own records that it had previously graded those cards at a lower grade,” according to the class action lawsuit.

PSA’s fee schedule incentivizes the company to over-grade cards for consumers who are willing to pay more so that their cards can be graded, according to the PSA class action lawsuit.

“PSA charges based on the perceived market value of cards and requires consumers to self-appraise the value of their cards before submission,” the plaintiff alleges.

The plaintiff states that PSA knowingly graded cards at higher grading levels for preferred customers who gave the company a high number of cards in order to collect the fees that come with those submissions.

The PSA class action lawsuit claims that the company guarantees consumers that it will not grade altered cards and that if they purchased an altered card, they will “be made whole” for the lost value of the baseball card.

The class action lawsuit also states that the company defrauded consumers by grading cards that were altered and then selling those cards to consumers.

In addition, another defendant in this case, PWCC Marketplace LLC, is accused of knowingly selling cards that were altered that were purported to be unaltered.

“In fact, collectors identified instances in which PWCC sold PSA rated cards which were then altered, submitted to PSA, graded at a higher level, and sold through PWCC by the original buyer,” the PSA class action lawsuit states.

Potential Class Members in this case include: “Individuals who used PSA’s services to rate cards, who bought altered cards that were nonetheless rated by PSA on its 1-10 scale, and who currently hold altered PSA rated cards including, but not limited to, those purchased through PWCC.”

Have you had baseball cards appraised? Leave a message in the comments section below.

The plaintiff is represented by Marcus J. Bradley, Kiley L. Grombacher, and Robert N. Fisher of Bradley/Grombacher LLP, and Sahag Majarian II of Law Offices of Sahag Majarian.

The PSA Altered Baseball Cards Class Action Lawsuit is Eric Savoy v. Collector’s Universe, et al., Case No. 30-2020-01130892-CU-RI-CXC, in the Superior Court for the State of California, County of Orange.

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