TigerDirect

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TigerDirect
TigerDirect logo.jpg
Type Subsidiary
Founded 1989 (1989)
Predecessor(s) Circuit City
Headquarters Miami, Florida, U.S.
No. of locations
Area served Nationwide
Founder(s)
  • Gilbert Fiorentino
  • Carl Fiorentino
  • Daniel Brown
  • Orlando Ramos
Industry Retail
Parent Systemax
Website
Alexa rank 1,119 (February 2014)[3]

TigerDirect is a direct online and catalog retailer of computers and consumer electronics. It is a Systemax subsidiary. Its headquarters are in Fontainebleau, Florida.[4][5]

Overview[edit]

TigerDirect in Canada

The bulk of the company's business is based on web and catalog computer electronics sales, where TigerDirect has carved out a niche by placing a heavy emphasis on rebate marketing as a way to offer lower prices. The company also operates retail store and business-to-business channels.

TigerDirect has locations in Miami (corporate headquarters, retail stores); Naperville, Illinois (distribution center, corporate sales offices, retail stores in Chicagoland); Jefferson, Georgia (distribution center, corporate sales office, retail store); and North Carolina (corporate sales office, retail stores). TigerDirect.ca has locations in Ontario: Markham(superstore), Etobicoke, Vaughan, Mississauga, Burlington, London, and Richmond Hill.

The online company WorldwideRebates.com performs some of its rebate processing and is owned by its parent company, Systemax.[6][7]

History[edit]

The company was founded as Tiger Software, a publisher of titles for both Microsoft Windows and Apple Macintosh in 1989. In 1989, Tiger Software became a subsidiary of publicly held Bloc Development Corporation (NASDAQ:BDEV). Bloc Development was also the parent company of BLOC Publishing, which continued the development and publishing of the company's flagship product FormTool, and 20 other products; and SoftSync, former publisher of the "EXPERT Software" titles and the Macintosh accounting software "Accountant Inc."). BLOC Development later changed its name to TigerDirect (NASDAQ:TIGR).

TigerDirect evolved from TigerSoftware when the company began selling build-it-yourself PC kits and inexpensive computers, using manufacturers in the United States and Canada to build its custom desktop and notebook configurations. In 1996, it was acquired by Systemax (NYSE: SYX)[8] The commercial website TigerDirect.com was launched in 1996, selling computer and electronics, books and software. In 2000, TigerDirect expanded its product offerings to include "refurbished" and "recertified" products, brand-name computers from IBM, HP, eMachines, Gateway and others.

Acquisition of CompUSA[edit]

On January 6, 2008, TigerDirect's parent company Systemax Inc. announced the acquisition of the CompUSA brand, trademarks and e-commerce business, and as many as 16 CompUSA retail outlets in Illinois, Florida, Texas and Puerto Rico.[9]

In late December 2012, CompUSA was consolidated into TigerDirect.[10]

Acquisition of Circuit City[edit]

On May 13, 2009, TigerDirect's parent company Systemax Inc. announced the acquisition of the Circuit City intellectual property, including its trademarks, brand name, and internet domain.[11] The deal took effect six days later for a price of 14 million dollars. The defunct CircuitCity.com website was restored after the Systemax purchase.

In late December 2012, Circuit City was consolidated into TigerDirect.[10]

Controversies[edit]

Federal Trade Commission ruling[edit]

On November 4, 1999, case C3903, the Federal Trade Commission issued a decision and order (which expires in 20 years) against TigerDirect for violations of the Pre-sale Availability Rule, the Disclosure Rule and the Warranty Act.[12] Without admitting any wrongdoing, TigerDirect agreed to:

  1. not represent that it provides On-Site Service unless all limitations and conditions that apply are disclosed;
  2. fulfill obligations under the warranty within a reasonable period of time after receiving notice from the consumer; and
  3. cease and desist from failing to make warranty text available for examination prior to sale, failing to disclose what is not covered under any given warranty or the procedures needed to have warranty work accomplished and failing to disclose that certain states may give the consumer legal rights in addition to those provided by the warranty.[12]

Apple Computer lawsuit[edit]

In early 2005, the company filed suit against Apple Computer Inc. (now Apple Inc.), alleging trademark infringement, dilution and false designation of origin with Apple's introduction of Mac OS X v10.4, marketed with its codename "Tiger". Although TigerDirect had registered several tiger-related names with the United States Patent and Trademark Office, Apple received trademark approval for version 10.4 (Tiger) of its OS X operating system in 2003. TigerDirect registered opposition against Apple's filing with the Trademark Trial and Appeal Board, and on May 13, 2005, Apple won an emergency hearing. The judge ruled in Apple's favor, noting "the Court finds that the marks are distinctly different."[13]

Infoworld report[edit]

Infoworld's Robert X. Cringely reported in 2006 that "Tiger's sister company OnRebate.com, which handles payouts for the discount dealer, appears to specialize in the 'insufficient documentation' gambit,"[14] and, commenting on the volume of complaints on the Internet, that "Tiger's rebate promises appear to be toothless."[15] Consumer-reported difficulties obtaining the rebates led to an investigation by the Florida Attorney General[16][17] and a failure to maintain a satisfactory BBB rating.[18] According to a former controller at TigerDirect, improperly unpaid rebates were intentional: "...the concept was that if the customer complains, you send them out the check to make them happy. But if they don't complain, they totally forget about it. That is the concept of these rebates. People forget that they sent them out."[19]

Dell lawsuit[edit]

On April 17, 2009, Dell, Inc. filed a lawsuit against TigerDirect.[20][21] Dell alleged that TigerDirect, a former authorized reseller of Dell products, sold discontinued and outdated Dell products as new and under a Dell warranty. Dell also alleged that the products were from a third-party and advertised with an unauthorized, modified version of the Dell logo. Dell became aware of this when TigerDirect customers contacted Dell to demand price matches.[20]

State of Florida lawsuit[edit]

On September 4, 2009, Florida Attorney General Bill McCollum filed suit against TigerDirect, OnRebate, and their parent company Systemax, charging the companies with failing to provide rebates to customers.[19] Systemax responded that a separate class action lawsuit making similar allegations was filed in federal court in 2007 and was dismissed on August 31, 2009. The company denied the allegations in the Florida Attorney General complaint and said it intends to defend itself vigorously. The suit was settled for $300,000.[22]

SEC investigation[edit]

On September 17, 2012, the U.S. Securities and Exchange Commission charged a former director of Tigerdirect's parent company, Systemax Inc for fraudulently reaping hundreds of thousands of dollars in undisclosed compensation between January 2006 to December 2010. The SEC alleged that Gilbert Fiorentino, who in addition to serving on the board was the former chief executive of Systemax’s Technology Products Group in Miami, "obtained more than $400,000 in extra compensation directly from firms that conducted business with Systemax." The SEC also alleged Fiorentino of stealing "several hundred thousand dollars worth of company merchandise that was used to market Systemax’s products." Fiorentino failed to disclose his extra compensation and perks to Systemax or its auditors, so that the amounts reported to shareholders were understated.[23]

In April 2011, Systemax placed Fiorentino on administrative leave. On May 9, 2011, Fiorentino agreed to resign from all of his positions with Systemax, surrender stock and stock options valued at approximately $9.1 million, and repay his 2010 annual bonus of $480,000. With Fiorentino's departure, Robert Leeds, Systemax's founding CEO of the technology division, took over as CEO of Systemax's technology products group.[23][24]

Fiorentino agreed to settle the SEC charges by paying a $65,000 fine and consenting to a permanent bar from serving as an officer or director of any publicly held company.[23]

References[edit]

  1. ^ TigerDirect.com, Inc. Web Development Team. "Retail Store Locator". Tigerdirect.com. Retrieved 2014-01-27. 
  2. ^ TigerDirect, Inc. Web Development Team. "Store Locator". Tigerdirect.ca. Retrieved 2014-01-27. 
  3. ^ "Tigerdirect.com Site Info". Alexa Internet. Retrieved 12 February 2014. 
  4. ^ "Contact Us." TigerDirect. Retrieved on January 9, 2010.
  5. ^ "Fountainbleau CDP, Florida." U.S. Census Bureau. Retrieved on January 7, 2010.[dead link]
  6. ^ "Systemax Q4 2007 Earnings Call Transcript – Seeking Alpha". Seekingalpha.com. 2008-03-10. Retrieved 2014-01-27. 
  7. ^ "OnRebate's Ties to TigerDirect". Jerryfeil.com. 2006-02-01. Retrieved 2014-01-27. 
  8. ^ "Systemax.com". Systemax.com. Retrieved 2014-01-27. 
  9. ^ "Systemax Announces Definitive Agreement to Acquire Selected Assets and Retail Stores From CompUSA". RedOrbit.com. Retrieved 2008-01-06. 
  10. ^ a b "Systemax To Cut Circuit City, CompUSA Brands, Exit PC Manufacturing". Twice.com. 2012-11-02. Retrieved 2014-01-27. 
  11. ^ "Firm buys defunct Circuit City’s brand, domain names". Syx.client.shareholder.com. 2009-04-13. Retrieved 2014-01-27. 
  12. ^ a b Case C3903 at FTC website
  13. ^ Court sides with Apple over "Tiger" trademark dispute, AppleInsider, 13 May 2005.
  14. ^ Cringely, Robert X. (December 29, 2006). "Microsoft tech support swoons, Google promises the moon: When 21st century software meets 12th century bureaucracy". InfoWorld. InfoWorld Media Group, Inc. Retrieved November 28, 2009. 
  15. ^ Cringely, Robert X. (December 1, 2006). "Microsoft and Novell go kablooey, Second Life gets gooey: Sometimes even $440 million can't buy you happiness". InfoWorld. InfoWorld Media Group, Inc. Retrieved November 28, 2009. 
  16. ^ Tuesday, January 29, 2008 - by Chad Weirick (2008-01-29). "Florida Attorney General To Investigate TigerDirect". Hothardware.com. Retrieved 2014-01-27. 
  17. ^ Albright, Mark. "TigerDirect Snags Three CompUSA Outlets", St. Petersburg Times, 12 February 2008.
  18. ^ "TigerDirect BBB Report". Retrieved 20 December 2006. 
  19. ^ a b "State sues TigerDirect, OnRebate". Bizjournals.com. 2009-09-04. Retrieved 2014-01-27. 
  20. ^ a b Dell, Inc. v. TigerDirect, Inc., Case No. 09-CV-3879, S.D.N.Y., 17 April 2009.
  21. ^ Joseph F. Kovar. "Dell Sues Tiger Direct, Alleges Old Computers Sold As New". CRN. Retrieved 12 February 2014. 
  22. ^ "Attorney General Reaches Settlement With Systemax". Office of the Attorney General of Florida. Retrieved 2011-06-15. 
  23. ^ a b c "SEC Charges Former Systemax Director in Compensation Scheme". U.S. Securities and Exchange Commission. Retrieved 2013-07-22. 
  24. ^ "Systemax exec resigns, must hand over $11 million". CNET. Retrieved 2013-07-22. 

External links[edit]