ASL Sues Former Exec for Alleged Conversion of List Names
A month-old lawsuit filed by American Student List Inc. against a former executive heated up yesterday with the filing of an amended complaint and an exchange of press releases.
ASL, Mineola, NY, filed suit on April 30 against former executive vice president Jan Stumacher, alleging that he and his companies, and Student Marketing Group Inc. and Rhina International Direct Inc. marketed names compiled by ASL. The firms are also named as defendants.
The amended complaint accuses Stumacher and his firms of conversion, deceptive business practices, false advertising and unfair competition, according to Mark Mulholland, partner at Ruskin, Moscou, Evans & Faltischek, Mineola, an attorney for ASL.
Two charges included in the original complaint were removed from the amended complaint, according to lawyers for both sides. One of the dropped charges is that Stumacher was guilty of “misconduct with respect to attaining names,” said his lawyer, Robert Hearth, partner at Sidley & Austin, New York.
The defense had asked that the two charges be dropped.
In a related matter, Stumacher and ASL are engaged in arbitration proceedings over Stumacher’s termination from ASL in February 1997.
Stumacher, who was employed by ASL for 25 years, said in an interview that the suit, “is nothing more than an attempt to forestall competition in the marketplace.”
The war of press releases started with an announcement yesterday by ASL that it had filed the amended complaint. Stumacher responded with a release denying the claims, and saying that ASL had withdrawn “baseless” claims.
ASL alleges in the amended complaint that lists sold by Stumacher “contained decoy names (names coded to show they are unique to ASL) that American Student List seeds into its list,” said Mulholland. “ASL believes the presence of those decoy names in Mr. Stumacher’s list is evidence that the list originated from ASL.”
Marty Lerner, ASL president, said the decoy names were discovered when ASL purchased a portion of the lists marketed by Stumacher’s company, Student Marketing Group Inc., Lynbrook, NY.
ASL’s database contains nine million names of high school seniors and college-bound high school students. ASL gathers data on high school students from a survey sent to students.
In addition to alleging that Stumacher is marketing names that were compiled by his former company, ASL challenges the accuracy of Student Marketing Group’s promotional material–particularly the claim that “50% of his names are gathered from a survey,” said Mulholland.
ASL also challenges Stumacher’s claims in promotional material that his files contain data such as grade point average, class rank, religious affiliation and sports activities, according to Mulholland. “We believe the only way to get access to that information is through the type of survey ASL conducts,” Mulholland added.
The unfair competition claim is based “on the [fact] that ASL has gone through extraordinary effort to compile its database and it is unfair for anyone to sell a part of those names at a discounted price where the discount is achieved because they did not have to go through the effort ASL did to capture those names,” said Mulholland. Student Marketing Group’s prices are about $40 per thousand less than ASL’s.
Stumacher admitted he is selling his names at a discount. “[A]nd ASL is unhappy about that,” Stumacher said. “They have not had any true competition in the marketplace for years.”
The suit was filed in the U.S. District Court for the Eastern District of New York in Uniondale.
When asked if he does his own survey, Stumacher said, “That’s confidential information.”
