Apple Files Complaint To Prevent Sale Of RadioShack Customer Data
The RadioShack bankruptcy took a harder turn into ugly territory yesterday with Apple's filing of a complaint in a Delaware court. The move is intended to keep the once-prevalent hardware giant from selling their customer data, joining the states of Texas and Tennessee in their efforts to prevent the company from opening their customer information coffers to the highest bidder.
The Apple complaint states that as a condition of the arrangement by which RadioShack was allowed to sell iPhones and iPads in its stores, the retailer would protect the personal data of customers choosing to buy Apple products. Specifically, Apple's complaint states, “The Reseller Agreement between Apple and RadioShack protects information collected by RadioShack regarding purchasers of Apple products (the “Apple Customer Information”) and prohibits the proposed sale of such information."
RadioShack's February bankruptcy filing requested a sell-off of $1.2 billion in assets, to be supervised by the courts. Among these assets is a customer information database that contains records on 117 million RadioShack customers, derived from mailing lists and service registrations.
In March, shortly after word came to light of RadioShack's intention to cash in on its customer data as part of an asset sell-off, Texas filed an objection with the court that specifically cited "consumer names, phone numbers, mailing addresses, e-mail addresses, and, where allowed, activity data" as information assets that should be prohibited from sale. Tennessee filed a similar objection in parallel, with both states arguing that RadioShack had numerous privacy policies in place in which they promised their customers that their personal information would never be sold to a third party.
The Apple complaint comes in the wake of a similar objection from AT&T, which has said that it owns a part of RadioShack's database as part of a deal they made with the retailer to sell mobile phones.
On Tuesday hedge fund Standard General agreed to pay $26.2 million to buy RadioShack's name, its customer data, and its remaining assets. The court, though, must still approve the sale of the customer data, and a hearing on the matter has been scheduled for May 20.
The Apple complaint states that as a condition of the arrangement by which RadioShack was allowed to sell iPhones and iPads in its stores, the retailer would protect the personal data of customers choosing to buy Apple products. Specifically, Apple's complaint states, “The Reseller Agreement between Apple and RadioShack protects information collected by RadioShack regarding purchasers of Apple products (the “Apple Customer Information”) and prohibits the proposed sale of such information."
In March, shortly after word came to light of RadioShack's intention to cash in on its customer data as part of an asset sell-off, Texas filed an objection with the court that specifically cited "consumer names, phone numbers, mailing addresses, e-mail addresses, and, where allowed, activity data" as information assets that should be prohibited from sale. Tennessee filed a similar objection in parallel, with both states arguing that RadioShack had numerous privacy policies in place in which they promised their customers that their personal information would never be sold to a third party.
The Apple complaint comes in the wake of a similar objection from AT&T, which has said that it owns a part of RadioShack's database as part of a deal they made with the retailer to sell mobile phones.
On Tuesday hedge fund Standard General agreed to pay $26.2 million to buy RadioShack's name, its customer data, and its remaining assets. The court, though, must still approve the sale of the customer data, and a hearing on the matter has been scheduled for May 20.
