More NewsJuno, TargitMail at Odds Over Contract

Juno, TargitMail at Odds Over Contract

A lawsuit alleges that the e-mail marketer never paid up, while its planned acquisition by a third party failed to materialized.

ISP Juno Online Services earlier this month filed suit against email marketer TargetMail.com, alleging breach of contract and seeking millions in damages.

Alley-based Juno also names the permission email marketer’s corporate parent, Global Technology Marketing International, in the $3.3 million lawsuit, which was filed in the U.S. District Court for Southern New York.

TargitMail.com did not return repeated requests for comment on the suit.

The dispute stems from a one-year agreement that the two firms signed in July 2000. According to the suit, TargitMail.com agreed to purchase advertising inventory on Juno’s proprietary email service.

Under the agreement, Juno agreed to deliver a specified volume of email advertisements to its subscribers on behalf of TargitMail. In return, TargitMail would pay Juno monthly based on the number of ads delivered.

Accordingly, Juno began delivering emails to its subscribers on behalf of TargitMail.com in September, and — according to the suit — sent “numerous” invoices for the amounts owed by TargitMail.com.

None of these invoices were paid by TargitMail.com, said Juno.

In January, the ISP stopped delivering emails because TargitMail had yet to pay. According to the suit, a termination because of a breach of contract by TargitMail means that TargitMail had to pay the remainder of its promised payments. TargitMail failed to pay this sum as well, alleges Juno.

A spokesperson for Juno said its management believed that it had no choice but to file suit in order to collect the amounts it was due.

“TargitMail.com is a large, sophisticated company which bills itself as a world leader in its field” said Richard Buchband, Juno’s senior vice president and general counsel. Juno has met its obligations under the agreement, and we expect to get paid.”

A date has yet to be set for the trial.

At least part of the problem might stem from TargitMail’s rather transitory status. In December, Boca Raton, Fla.-based Internet holding company iiGroup signed a letter of intent to purchase the firm. However, the terms of the agreement lapsed — iiGroup said it had been unable to come up with $3 million for the purchase.

Through the proposed acquisition, the terms of which were not disclosed, Boca Raton, Fla.-based iiGroup stood to gain a sizable opt-in address database of 21 million addresses.

iiGroup had said it aimed to boost traffic and sales on its other portfolio sites through the purchase. But at least some of the rationale behind the acquisition stemmed from TargitMail’s claim that it expects profitability sometime this year, and projected sales of more than $20 million. If Juno’s claims in the lawsuit are true, then the news casts TargitMail’s earlier predictions in a grim light.

A spokesperson from iiGroup declined to comment.

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