A deal for Build.com to acquire web-only small appliances merchant Living Direct has been in active negotiation, sources tell Internet Retailer.
Build.com filed a complaint against HM Wallace and PriceGrid alleging they conspired to gain access to its computer system.
Build.com Inc. has filed a civil complaint against HM Wallace Inc., operator of PerformanceToilets.com and other building supply web sites, and PriceGrid LLC, an online price-monitoring company, alleging they engaged in unfair business practices and conspired to gain unauthorized access to Build.com’s computer system and product information.
The complaint charges that Wallace, based in Austell, GA, and PriceGrid, based in San Francisco, conspired to scrape data and product images from Build.com’s servers earlier this year to gain an unfair competitive advantage. PriceGrid developed a spider “that targeted Build.com’s computer servers for the purpose of copying or extracting data, images, taxonomy, ontology and copyrighted product descriptions stored in the servers,” the complaint states.
Build also charges that at least six times in June the spider extracted data and at the same time interrupted the web site’s operation. Those interruptions cost Build.com $500,000 in sales, and the company is seeking compensation for the loss in addition to fees incurred investigating the cause of the server interruptions, according to the complaint filed last week in the Sacramento Division of the U.S. District Court for the Eastern District of California.
While Build.com was investigating the server interruptions it received an e-mail from a then-Wallace employee that included “an e-mail chain to Build.com, which clearly and unmistakably demonstrates that HM Wallace had conspired with PriceGrid to wrongfully and illegally scrape data and images from Build.com’s website,” the complaint says.
Build.com has done business with other building supply companies during its 10 years in business, says Christian Friedland, founder and president of Build.com, No. 97 in the Internet Retailer Top 500 Guide. “This is disappointing for us” Friedlander says. “We haven’t been litigious in our 10-year history, we’ve always tried to resolve issues through discussion. But this is an egregious betrayal.” The company was previously known as Improvement Direct and operates specialty web sites such as FaucetDirect.com and LightingDirect.com.
Build.com has sourcing arrangements with other suppliers such as The Home Depot Inc. (No. 39 in the Top 500 Guide), Friedlander says. Build.com and HM Wallace began a sourcing arrangement earlier this year, he says.
A PriceGrid spokesman declined comment until the suit could be reviewed. HM Wallace, which also operates National Builder Supply, did not respond to a request for comment.