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Posted on Thu, Sep 1, 2011 : 12:15 p.m.

Borders files lawsuit, accusing consumer database company of misusing loyalty program

By Nathan Bomey

Ann Arbor-based Borders Group Inc., which is in the process of liquidating, sued Next Jump Inc., accusing the consumer database company of "trade-secret misappropriation and trademark infringement over the use of a website," Bloomberg reported.

Next Jump, which was running the Borders Rewards loyalty program, used customer data to create a website called OO.com, according to the lawsuit cited in Bloomberg's report.

Borders reportedly believes that Next Jump's actions threaten to undercut the value of the intellectual property Borders is hoping to sell in an auction later this month. Borders is auctioning off its IP, including its brand name, website and loyalty program database.

Borders is closing the 399 stores that were still operating when the company converted its Chapter 11 bankruptcy reorganization into a full-scale liquidation in July. All of the stores are expected to be closed by the end of the month.

Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.

Comments

A2comments

Fri, Sep 2, 2011 : 11:20 a.m.

When Borders filed, I immediately removed my name from their program.

quetzalcoatl

Thu, Sep 1, 2011 : 10:46 p.m.

Among the no-doubt tens of thousands of names on Border's customer loyalty list is my own. They should plan on deducting from their anticipated receipts for the sale of that list whatever it costs them to defend themselves from the lawsuit I am going to file when first I am contacted by whoever buys the list.

Macabre Sunset

Thu, Sep 1, 2011 : 10:51 p.m.

Unfortunately, you have no legal recourse here. Equally unfortunately, you and I are not like the average customer, who would not react to that contact by never doing business with the company again. Kirby Vacuums are still sold door-to-door, and it's still a viable company, believe it or not.

Out-of-Towner

Thu, Sep 1, 2011 : 8:09 p.m.

I was wondering how I got on the "OO.com" email list...

Macabre Sunset

Thu, Sep 1, 2011 : 7:46 p.m.

Isn't there a significant irony in the concept of being able to "sell" your customers' loyalty to the highest bidder? Some day it will become illegal to sell customer data without express permission from the customer. I know, not while Bushpublicans and Obamacrats are running the show, beholden to the big businesses that financed their elections. While the Borders rewards program was never all that good, when compared to what you can find elsewhere, I'm doubly glad today that I never joined.

Macabre Sunset

Thu, Sep 1, 2011 : 10:49 p.m.

I should be more clear. Some day it will become illegal to sell customer data without express, informed and separate permission. In other words, the transaction adding you to the spam list (now legal under the You-Can-Spam Act) and adding your purchase information to all sorts of databases should only be legal if you are separately asked for your consent and compensated specifically for that permission.

johnnya2

Thu, Sep 1, 2011 : 9:27 p.m.

"Some day it will become illegal to sell customer data without express permission" If you actually read the terms of the rewards program you would realize the customers DID give express permission. There is also a very easy way to get out of the program. All email that come from Borders and any other legitimate email sending company includes an unsubscribe or opt out link. It is required by law.