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Groupon Accused in Lawsuit of Altering Merchant E-Mails

Groupon Shares Plunge for Second Day
Groupon Inc. signage is displayed at company headquarters in Chicago. Photographer: Tim Boyle/Bloomberg

Dec. 6 (Bloomberg) -- Groupon Inc., the largest Internet daily deal site, was accused in a lawsuit of altering e-mails of agreements with merchants after both sides had accepted the terms.

BidMyCrib.com sued Groupon today in federal court in Chicago, seeking to make the case a group lawsuit, or class action, on behalf of the company’s merchant clients. The suit, which accuses Groupon of violating the Stored Communications Act by altering sent e-mails “in electronic storage,” seeks unspecified damages.

Groupon, based in Chicago, raised $700 million in an initial public offering last month, selling 35 million shares in the biggest IPO by a U.S. Internet company since Google Inc.’s in 2004. Founded in 2008, the company sells daily, discounted deals for local businesses including restaurants, hotels, services and retail shops.

Groupon corresponds with its merchant-clients by e-mail and transmits its merchant agreements in the body of e-mailed messages, according to the complaint by BidMyCrib, a website that allows contractors to bid on residential construction projects. The company later goes into those e-mails and alters the content, according to the complaint.

Groupon changed at least one section of the merchant agreement with BidMyCrib by adding a new sentence regarding voucher expiration dates to the previously agreed-upon language, according to the complaint.

Julie Mossler, a spokeswoman for Groupon, declined to comment on the lawsuit.

The case is BidMyCrib LLC v. Groupon Inc., 11-8647, U.S. District Court, Northern District of Illinois (Chicago)

To contact the reporter on this story: Sophia Pearson in Philadelphia at spearson3@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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