Court Rules Yellow Book USA Violated State and Federal Law by Making False Claims of Directory Usage
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NEW YORK - A federal court ruled today that Yellow Book USA Inc. "made false statements of fact claiming greater use of its yellow pages directories as compared to Verizon's SuperPages."
In a decision handed down today by Judge Jack B. Weinstein of the U.S. District Court in Brooklyn, the court found that Yellow Book USA Inc. "violated the Lanham Act by falsely claiming, as to national and some specific geographic areas, that the usage of Yellow Book's yellow pages was substantially greater than it actually was, as compared to the usage of Verizon's Superpages."
Judge Weinstein had previously ordered that a second phase of the trial take place on Dec. 13 to fix the amount of damages that Verizon has suffered. However, Verizon and Yellow Book reached a settlement, and the December trial has been canceled. Terms of the settlement are not being disclosed.
The court noted that "Verizon enjoys substantially greater usage of its directories nationally and in most of the local markets in which it competes with Yellow Book." The court determined that Yellow Book's claims of greater usage were false and misleading, and that Yellow Book knew they were false when it made them.
"The court's decision today sends a clear message to Yellow Book: Stop deceiving advertisers and the public," said Lester Chu, vice president - strategic planning and marketing for Verizon Information Services.
"Directory usage is a critical factor to an advertiser in making a purchasing decision," he said. "The evidence presented to the court overwhelmingly demonstrated that Yellow Book could not -- despite its marketing campaign -- truthfully claim that it had greater usage than Verizon SuperPages in any major market where the two companies compete."
After the judge criticized Yellow Book during the trial, Yellow Book stopped making the false claims in radio and television commercials and also directed its sales force to stop making the erroneous claims.
In addition, the court ruled that "in some of its sales collateral Yellow Book referenced research studies performed by the Harris research organization that employed dubious survey methodology; the data was then manipulated by Yellow Book employees, resulting in inflated usage figures for Yellow Book's directories compared to those for Verizon in some geographic areas."
Chu said, "This is a victory for ethical business practices. The true winners today are all business owners - small and large - who depend upon factual information to make critical decisions about where to spend their advertising dollars. We pride ourselves on integrity and ethics. With this decision, I hope that Yellow Book will now join us in that effort."
About Verizon SuperPages and SuperPages.com
Based in the Dallas area, Verizon Information Services is a content provider for communications products and services, with approximately $4.1 billion in revenues. The company produces Verizon SuperPages, the nation's leading yellow pages, and Verizon SuperPages.com (www.superpages.com), the nation's number 1 Internet directory and shopping resource. SuperPages On the Go is the best information directory offered on Get It Now services through Verizon Wireless and other carriers. The company also is the largest publisher of Hispanic directories in the U.S. and the first to provide a Hispanic online shopping resource (www.superpages.com/espanol). Verizon is a leader in community support, fund donations, volunteer hours and in-kind services in its communities. Verizon Information Services is a unit of Verizon Communications Inc. (www.verizon.com).
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A Dow 30 company, Verizon Communications (NYSE:VZ) is one of the world's leading providers of communications services, with approximately $68 billion in annual revenues. Verizon companies are the largest providers of wireline and wireless communications in the United States. Verizon is also the largest directory publisher in the world, as measured by directory titles and circulation. Verizon's international presence includes wireline and wireless communications operations and investments, primarily in the Americas and Europe. For more information, visit www.verizon.com.