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Lerach Coughlin Stoia Geller Rudman & Robbins LLP Files Class Action Lawsuit Against Webloyalty.Com Alleging Massive Consumer Fraud; Complaint Alleges Marketing Company Charged Bogus Membership Fees to Visitors of Popular Websites

Posted on: Monday, 11 September 2006, 15:00 CDT

A class action lawsuit was filed today against Webloyalty.com, Inc., an online marketing services company that boasts partnerships with popular websites fandango.com, staples.com and classmates.com among others, alleging it charged unwitting consumers monthly fees for memberships after they used its partners' sites to make purchases, according to plaintiffs' lawyers.

The lawsuit, filed in the United States District Court for the District of Massachusetts by Lerach Coughlin Stoia Geller Rudman & Robbins LLP, the nation's most successful shareholder and consumer class action law firm, Lee & Amtzis, P.L., and Phillips & Garcia, LLP, seeks an injunction on the claims, compensation for consumers and other remedies.

The attorneys allege that Webloyalty.com, based in Norwalk, CT, has reaped and continues to reap tens of millions of dollars off consumers by illegally obtaining personal, private information, including credit card information, of visitors to its partners' websites. Webloyalty.com automatically charges consumers monthly fees for a membership in one of its services without the consent of the consumer. As a result of the conduct alleged in the lawsuit, Webloyalty has grown from a company generating revenues of $55 million in 2003 to a company generating revenues of $110 million in 2005.

"Individuals who purchase products through the Internet should be extremely wary about doing so in the future given that there are companies out there whose solitary goal is to cheat the American public," said Stuart A. Davidson, a Boca Raton-based attorney with Lerach Coughlin. "Incredibly, even reputable companies are involved with, and are aiding, Webloyalty in its illegal pursuit of our hard-earned money."

The lawsuit also alleges that Fandango and Webloyalty have violated consumers' federally protected privacy rights by disclosing and using their private credit card information, and are engaging in deliberately deceptive business practices, illegally netting the company substantial sums of money from the consuming public.

The impact of these claims on consumers is enormous, according to experts. A study by comScore Networks, Inc., a company that measures Internet usage, found that "(t)otal Internet spending for the full year 2005, including travel, reached $143.2 billion."

If you would like to receive information or materials regarding the Webloyalty litigation, contact plaintiff's counsel, Stuart Davidson at sdavidson@lerachlaw.com.

A copy of the complaint may be viewed online at http://www.lerachlaw.com/cases/webloyalty/complaint.pdf.

Webloyalty's business partners include or have included the following online e-commerce retailers, among others: fandango.com, movietickets.com, staples.com, tigerdirect.com, ebgames.com, ftd.com, priceline.com, classmates.com, lillianvernon.com, allposters.com, half.com, joann.com, 123inkjets.com, americangreetings.com, drugstore.com, lanebryantcatalog.com, and petco.com.

ABOUT THE LAW FIRMS

Lerach Coughlin, a 180-lawyer firm with offices in San Diego, San Francisco, Los Angeles, New York, Boca Raton, Washington, D.C., Houston, Philadelphia and Seattle, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. Lerach Coughlin lawyers have been responsible for more than $20 billion in aggregate recoveries. The Lerach Coughlin Web site (http://www.lerachlaw.com) has more information about the firm.

Lee & Amtzis, P.L. is a firm that concentrates in business litigation, bankruptcy, and class action litigation. The firm represents individuals and business entities nationwide in business related disputes and complex litigation, including matters involving the federal securities laws, state consumer protection laws, copyright infringement, trademark infringement, federal racketeering laws, and other business related matters. The firm has obtained numerous multi-million dollar settlements for clients, including settlements in excess of $10 million.

Phillips & Garcia is a Massachusetts based consumer class action law firm that challenges predatory, unfair and deceptive corporate and governmental practices that injure consumers and small businesses. The Phillips & Garcia Web site (phillipsandgarcia.com) has more information about the firm.

Source: Business Wire

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