Toysmart Database To Be Destroyed

deebaine writes: "CNN has this article describing the settlement of the case of Toysmart.com's customer database, which Toysmart proposed to sell to the highest bidder in order to pay off their creditors. Apparently, the settlement stipulates that a Disney subsidiary will pay Toysmart $50,000, and they will destroy their own records. The FTC is hailing it as a victory."

Comments

The tears of a marketing droid.

[AtariDatacenter]

I'm sure there are the 'free enterprise/make money fast' types out there that would say this is a complete travesty of justice. Certain parts of a company shouldn't be deemed 'off limits'. In a way, I almost think they're right. Someone *could* buy the customer list, but they should be bound to the conditions that it was compiled under, which means that it can't be used.

The sad thing is that this probably happens all the time, just this was a high enough profile case to be caught.

An option.

[Restil]

The way I read that article, a company may be 100% willing to uphold their promises to maintain the privacy of their customers, but bankrupcy laws force them to sell off all assets, including their list of customers.

Ok.. fine. They can sell off their list of customers. However, what if their list of customers only includes those customers that have purchased something in the last 30 days.

If I'm a brick&morter operation, sure.. MAYBE I want to send my customers advertisements every once in a while. After all, happy customers will come back for more. For this very reason, there is no need to keep their information on file. THEY WILL RETURN BY THEMSELVES.

If they don't return, well, they probably aren't all that interested anyways, and there's no reason to keep their records on file. All you need is the record of the transaction.

If the computer system automatically deletes the records of any customer who has not purchased something in the last 30 days, then the only customers who will have an open account are the ones that purchase something regularly. When the company plans to go out of business, simply disable the order screen but keep the system online for an extra month. Those customers will automatically be deleted by default, but at no time has the company intentionally destroyed any assets, as the customer list was never considered an asset to begin with.

On the other hand, most likely the companies in question actually WANT to sell it off because thats less money they'll have to come up with later to cover the debts after bankrupcy if any.

-Restil