News America Marketing Sues Valassis Alleging Bogus Web Posts
News America Marketing has sued Valassis over the latter’s use of online “sock puppets” to make allegedly misleading posts on BringBacktheCoupons.com, a web site created to protest Valassis’s withdrawal from the newspaper coupon business.
BNET readers — who first learned of Valassis’s alleged use of bogus online identities to fight its critics and News America on coupon websites yesterday — can download a copy of the suit here.
Although News America is seeking damages for “defamation” and unfair competition created by Valassis’s alleged false posts, readers probably shouldn’t get too excited by the suit’s potential consequences. News America and Valassis have at least three other much bigger lawsuits pending between them. This suit will likely get settled or resolved as part of one of the others.
So if it’s irrelevent, why was it filed? One reason is that News America has been starving for good news recently (or at least bad news about Valassis, which is the same thing in NAM-Land).
In the last few weeks News America was forced to settle a case after testimony by one of its own former executives alleged that News America had ripped off its own clients by taking money for hundreds of ads that were never placed in supermarkets across the country.
That case also alleged that News America boss and New York Post publisher Paul “I will destroy you!” Carlucci can be an unpleasant lunch guest, and that News America “engaged in illegal computer espionage by breaking into [a rival's] password-protected computer system and obtaining propietary … information.”
Here’s a digest of News America’s allegations against Valassis in the sock puppet case. (You can see a probable example of a Valassis sock puppet post on BNET’s comments board here.):
On February 1, 2009, as part of an ongoing strategy to deal with declining newspaper circulation and reduce cost, Valassis discontinued its “RedPlum” FSIs in many Sunday papers in favor of mailing the coupons directly to consumers’ homes through shared (or junk) mail.
Valassis’s decision to pull its RedPlum FSIs and replace them with junk mail sparked a flurry of complaints on consumer advocacy websites from consumers outraged at Valassis’s strategy.
Valassis developed a concerted campaign aimed at redirecting consumer anger towards News America by making a number of fraudulent, misleading and
defamatory statements about its competitor.The keystone of Valassis’s disinformation campaign was to create several aliases it could then use to post false information regarding News America on consumer websites.
Valassis used the aliases to deceptively represent itself as an “honest consumer” or as an advertising executive working for a CPG. It then published false and defamatory statements with the goal of improperly deceiving and misleading consumers (and News America’s CPG clients) into believing that News America was actually the source of these websites. In this manner, Valassis hoped to destroy consumer confidence in News America and undermine its business relationships with CPG companies.
In one post on the Bring Back the Coupons consumer advocacy website, for instance, a Valassis executive pretended to be “Max,” an “honest consumer”…
“Max” posted a number of patently false statements, including one claiming that News America owned the Bring Back the Coupons website and that it had created it to co-opt the consumer advocacy movement. Warning consumers — potential News America customers — not to become “shill(s) for the man,” Valassis falsely accused News America of “pretending to be concerned consumers with a grass-roots effort…” and “pretend(ing) to care about (consumers) when (it) obviously (had) ulterior motives.” “Max” then suggested boycotting News America by stating that he “would not support a company (News America) that tries to use (him).” In other words, Valassis falsely accused News America of the very underhanded tactic in which it was itself engaged.
a Valassis executive posing as “Jane,” falsely claimed that News America and its employees were “particularly ruthless” and had been acting “illegally.” Jane quoted from Valassis’s complaint against News America in actions pending in Michigan, even though there has been no finding of illegality in that case, and any suggestion to the contrary is patently and demonstrably false. Valassis did this in an effort to deceive and confuse consumers and CPGs, and to unfairly compete by attempting to redirect consumer anger towards News America.
- See BNET’s previous coverage of the in-store marketing wars:
- Valassis Accused of Using Hidden Identities in Online War With News America Marketing
- News America Marketing Forces Whistleblower Into Bankruptcy
- News America Marketing Whistleblower: Clients Were Charged for Ads That Never Appeared
- Was N.Y. Post’s Carlucci the Reason for News America Marketing’s Settlement With Floorgraphics?
- News America Marketing’s Alleged Plans to Seize Safeway Account Outlined in Suit
- Valassis to Stick With “Majority” of Newspapers; Settles Fraser Billing Dispute
- Valassis, Insignia Stock Jumps on News America Marketing Group Settlement
- Valassis CEO Got Big Raise Despite Company’s Losses
- News America Marketing Group Wins Summary Judgment Against Whistleblower Robert Emmel
- News America Marketing Group Buys Floorgraphics Just Hours After Settling Spying Lawsuit
- News America Marketing Group Settles With Floorgraphics; Valassis, Insignia Likely Rejoicing
- Valassis May Not Be Able to Pay Debt; Litigation May “Materially Harm” the Company
- Trial: Did News America Marketing Group Break Into Floorgraphics’ Computers?
- Valassis Stock Threatened With De-listing by NYSE
- Valassis’ Plan to End Newspaper Coupons Outrages Middle America
- Valassis Suit vs. News America Being Conducted in Secrecy
- Valassis: Layoffs Will Continue as It Reduces Newspaper Coupon Business; It’s All News America’s Fault
- Valassis Writes Down $245 Million in Assets; Legal Bills Running at 10% of Profits
- Valassis Angers Blogger Moms by Yanking RedPlum Coupons From Newspapers
- Valassis Reduces the Cost of Fun for Employees
- Direct Mail Giant Valassis Is “Not Paying Its Bills”; Stock Is “Worth $0”
- The Cost of Valassis’ Suit vs. News America Is Eating Its Profit
Jim Edwards, a former managing editor of Adweek, has covered drug marketing at Brandweek for four years, and is a former Knight-Bagehot fellow at Columbia University's business and journalism schools. Follow him on Twitter or send him an email.
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