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The article doesn't seem to indicate so, but shouldn't the Best Buy executives who took this decision (and against whom there seems to be incriminating email ev

by tsycho 14y ago

The article doesn't seem to indicate so, but shouldn't the Best Buy executives who took this decision (and against whom there seems to be incriminating email evidence), be punished in some way as well? Else, from Best Buy's perspective, this is still potentially a net win if they made $140 million and had to pay out $27 million. And more importantly, the actual net benefit of following such a strategy (assuming BB has done this to other small companies as well) is likely much higher if the other victim firms weren't able to fight the lawsuit against BB. Punishing the executives will hopefully be a deterrent to other executives.

nowarninglabel 14y ago
>if they made $140 million and had to pay out $27 million. They made $140 million in revenue, not profit. With the kind of margins they run, they almost certainly didn't make $27 million in profit. Plus, there are the losses from their legal costs, which probably runs into the millions as well. That said, it's unclear to me if Best Buy is now allowed to continue with using the model, in which case they can probably recoup any losses.
- tinco 14y ago
  It most certainly is not, in the same way that when you are punished for stealing a car, you do not get to keep the car. If Best Buy wants to keep using the model they will have to come to a licensing agreement with TechForward or whoever owns the IP. And they're not in a very advantageous position..
  - tptacek 14y ago
    They no longer operate the program.
    - tinco 14y ago
      What do you mean? Who stopped operating what program? edit: oh you mean BB running the buyback program. Well I assume the analytical model could be used in other ways probably. I don't think wether this specific program has stopped is very relevant to wether BB is still allowed to use that model.
      - tptacek 14y ago
        The sensitive contents of the "analytical model" were enumerated in earlier filings in this case and involved the number of customer redemptions of the program and resaleability and inventory issues with repurchases products. Best Buy replaced significant portions of the model by using an insurance-backed system instead of a cash reserve system (parameters for the cash reserve system were one of the enumerated sensitive model bits). Several of the other "smoking gun" claims that Techforward made were elements of Techforward's own website. Techforward operated a buyback program independently at the same time they were in partnership talks with Best Buy. Anyone could have looked up the terms they used. I don't think it's likely Best Buy is using this stuff outside the buyback program.
        tinco 14y ago
        Ah ok that makes sense :)
saraid216 14y ago
> The article doesn't seem to indicate so, but shouldn't the Best Buy executives who took this decision (and against whom there seems to be incriminating email evidence), be punished in some way as well? In a word, no. And no, precisely because of the legal entity we call a corporation. IANAL, mind you, so I might have this completely wrong. But as I understand it, the whole point is that Best Buy as a whole is punished, and if the corporation feels that the best way to learn from this mistake is to punish its executives, that's their prerogative. The bad decision was made by representatives of the corporation acting in the capacity of said corporation: therefore the party at fault is the corporation, not the individuals. (To people more familiar with law, I'd appreciate confirmation that I got this right.)
righteous 14y ago
Its not in the press much, but Best Buy has probably turned over 50% of its executive level leadership in the last 12 months. In another 12 months another 20-40% will turnover. The new CEO is cleaning house. Its a good thing.

by tsycho 14y ago

nowarninglabel 14y ago

>if they made $140 million and had to pay out $27 million. They made $140 million in revenue, not profit. With the kind of margins they run, they almost certainly didn't make $27 million in profit. Plus, there are the losses from their legal costs, which probably runs into the millions as well. That said, it's unclear to me if Best Buy is now allowed to continue with using the model, in which case they can probably recoup any losses.

tinco 14y ago
It most certainly is not, in the same way that when you are punished for stealing a car, you do not get to keep the car. If Best Buy wants to keep using the model they will have to come to a licensing agreement with TechForward or whoever owns the IP. And they're not in a very advantageous position..
- tptacek 14y ago
  They no longer operate the program.
  - tinco 14y ago
    What do you mean? Who stopped operating what program? edit: oh you mean BB running the buyback program. Well I assume the analytical model could be used in other ways probably. I don't think wether this specific program has stopped is very relevant to wether BB is still allowed to use that model.
    - tptacek 14y ago
      The sensitive contents of the "analytical model" were enumerated in earlier filings in this case and involved the number of customer redemptions of the program and resaleability and inventory issues with repurchases products. Best Buy replaced significant portions of the model by using an insurance-backed system instead of a cash reserve system (parameters for the cash reserve system were one of the enumerated sensitive model bits). Several of the other "smoking gun" claims that Techforward made were elements of Techforward's own website. Techforward operated a buyback program independently at the same time they were in partnership talks with Best Buy. Anyone could have looked up the terms they used. I don't think it's likely Best Buy is using this stuff outside the buyback program.
      - tinco 14y ago
        Ah ok that makes sense :)

saraid216 14y ago

> The article doesn't seem to indicate so, but shouldn't the Best Buy executives who took this decision (and against whom there seems to be incriminating email evidence), be punished in some way as well? In a word, no. And no, precisely because of the legal entity we call a corporation. IANAL, mind you, so I might have this completely wrong. But as I understand it, the whole point is that Best Buy as a whole is punished, and if the corporation feels that the best way to learn from this mistake is to punish its executives, that's their prerogative. The bad decision was made by representatives of the corporation acting in the capacity of said corporation: therefore the party at fault is the corporation, not the individuals. (To people more familiar with law, I'd appreciate confirmation that I got this right.)

righteous 14y ago

Its not in the press much, but Best Buy has probably turned over 50% of its executive level leadership in the last 12 months. In another 12 months another 20-40% will turnover. The new CEO is cleaning house. Its a good thing.