2

business located at 2700 West Plano Parkway, Plano, Texas 75075. Stonebridge does business

throughout the United States, the state of Illinois, and Cook County.

3. Defendant J.C. Penney Company, Inc. is a chain department store with locations

throughout the United States, as well as significant over-the-phone catalog and online operations.

J.C. Penney is a corporation incorporated and existing under the laws of the state of Delaware,

with its corporate headquarters located at 6501 Legacy Drive, Plano, Texas, 75024. J.C. Penney

does business throughout the United States, the state of Illinois, and Cook County.

Jurisdiction and Venue

4. The Court has jurisdiction over this action pursuant to 735 ILCS 5/2-209(a)(1)

because all Defendants do business in this state and because Plaintiff Sims is a citizen of Illinois

and Cook County.

5. Venue is proper in Cook County because all Defendants do business in Cook

County and because the causes of action arose here.

Facts Common to All Counts

I. Post Transaction and Preacquired Account Marketing

6. Preacquired account marketing is a simple concept: a consumer purchases a

product from a retailer either online or over the phone; thereafter, the retailer “shares” the

consumer’s billing and contact information with a business partner so that it may market its own

product, usually a monthly membership program providing discounts. This sharing of consumer

information is commonly referred to as a “data pass.” The retailer or “merchant partner” who

originally acquired the billing information is paid a fee by the third party for every person who is

willingly or unwillingly enrolled in that third party’s program. However, because the third party

receives the consumer’s billing information, preacquired account marketing is open to extensive

3

abuse in the form of charges stemming from unauthorized enrollment or charges beyond what

was authorized.

7. The majority of consumers do not consent to the sharing of their information in

this manner, and more often than not are completely unaware that a merchant has transferred

their information to a third party or that they have become enrolled in a recurring monthly

membership program by that third party. In contrast, third party sellers and their merchant

partners are completely aware of and act in concert to specifically design the deceptive business

model at issue in this case.

8. Any possible benefits that exist from the membership programs or “loyalty clubs”

are rarely realized because the overwhelming majority of consumers are unaware they have been

enrolled in these clubs and/or programs in the first instance or were never given accurate or full

disclosures of the same.

9. However, even after thousands of complaints, a wide variety of preacquired

marketing continues to plague consumers on a daily basis.

II. Stonebridge’s History of Deceptive Marketing

10. Defendant Stonebridge has been active in the preacquired marketing industry

since 1994. Stonebridge operates numerous membership programs, and partners with large

retailers, such as Defendant J.C. Penny, to generate customer leads. Over the past decade-and-a-

half, Defendant Stonebridge has deceptively and without authorization charged tens of thousands

of consumers millions of dollars for these programs.

11. Defendant Stonebridge’s Membership Programs include, but are not limited to:

Savings2Go, PlanPlus, LeisurePlus, MotorPlus, Everyday Bargains, Backporch, Savings

Solutions, Fun Family Rewards, Fun Family Select, Perfect Home Rewards, and Perfect Home

4

Select (collectively referred to herein as the “Membership Programs”). Defendant Stonebridge

has received thousands of complaints from consumers related to each of its Membership

Programs.

12. The Membership Programs purport to provide various discounts and benefits

applicable to a variety of companies with which Stonebridge contracts. The overwhelming

majority of “enrolled” consumers are entirely unaware they have been enrolled in a Membership

program, or do not understand the terms of the membership program because they were not

clearly or fully disclosed.

13. Defendant Stonebridge, through the direct assistance and partnership with

Defendant J.C. Penney, as well as other Merchant Partners, enrolls consumers in its Membership

Programs either by telephone or online as consumers make a purchase from the Merchant

Partners.

Over the Phone Enrollment

14. Over the phone enrollment takes place in one of two ways. First, when a

consumer calls a Merchant Partner such as J.C. Penny to purchase a product, the Merchant

Partner’s telemarketer uses a marketing technique known as an “upsell” to sell Stonebridge’s

membership programs. The upsell takes place only after the customer places an order with a

Merchant Partner and has already provided billing information (i.e., at the point in time when the

call would normally be over).

15. The second over the phone method involves a telemarketer working directly for

Defendant Stonebridge whereby they call a consumer after they have made an online or over the

phone purchase from a Merchant Partner. Stonebridge is able to call the consumer because the

Merchant Partner has shared all of the consumer’s contact information and billing information

5

with Stonebridge prior to the call. Utilizing the consumer’s prior purchase with its Merchant

Partner as an opening inducement to talk and gain the consumer’s trust, the Stonebridge

telemarketer then endeavors to sell the consumer a membership program.

16. In both scenarios, all representations made by the telemarketers fail to adequately

disclose the nature and terms of the Membership Programs and specifically omit terms related to

price and the negative option nature of the program. Representations made to induce consumers

to enroll include offering “free trials” and complimentary gift cards or merchandise. The “free

trials” are actually negative option memberships where a consumer is required to call and cancel

to avoid being charged, and complimentary gifts are rarely, if ever, received.

17. In both scenarios, the telemarketers utilize a uniform script for all calls. The

telemarketers are trained to omit or gloss over any unappealing terms, and recite a script that is

designed to make the offers seem appealing. Across the board, these scripts uniformly fail to

adequately describe the cost and other relevant terms of enrollment in Stonebridge’s Membership

Programs. At no point during the registration process do the telemarketers clearly disclose the

terms of enrollment in the Membership Programs. Accordingly, consumers who are offered

membership by these telemarketers do not understand the terms of the solicitation, or become

confused by the details and fast paced description of the various offers.

Online Enrollment

18. In a similar fashion, when consumers purchase online from Merchant Partners,

they are enrolled in Defendant Stonebridge’s Membership Programs either through negative

option billing or through fictitious rebate offers presented at the time of purchase.

19. Consumers do not provide billing or account information directly to Stonebridge

in order to receive the “free trial” or “rebate” as the Merchant Partners already have it and pass it

6

onto Stonebridge.

No Contact Enrollment

20. In many instances, Defendants blatantly ignore consumers who decline

enrollment in the Membership Programs either over the phone or online, and enroll consumers

regardless of their response.

21. In particular, whether the billing information is originally collected on the phone

or online, Defendant Stonebridge enrolls consumers in Membership Programs without contacting

the consumer, giving any form of notice, and with no consent whatsoever. Specifically,

consumers are never offered the Membership Program by a telemarketer or through an online

offer; instead, Defendant Stonebridge simply acquires consumers’ billing information from their

Merchant Partners and then enrolls the consumers in their Membership Programs entirely

without their knowledge or consent.

22. Additionally, it is Stonebridge’s common practice to enroll consumers in multiple

Membership Programs simultaneously without permission, each carrying a separate monthly or

annual charge.

Membership in Defendant’s Programs

23. Regardless of the manner in which a consumer becomes enrolled, the

overwhelming majority of consumers have no idea they are in the program or that they will

subsequently be charged on a recurring monthly basis. When charges from Stonebridge do

appear on a consumer’s bill, they are deceptively mislabeled – intentionally so – to reduce the

likelihood of a consumer noticing the unauthorized charges.

24. Because consumers are unaware that they are being enrolled in a Membership

Program or do not understand when or how they will be charged, because the amount charged by

7

the seller is relatively small, and because the charges are disguised on consumers’ billing

statements, consumers often do not discover these charges on their account statements until

several months or even years have elapsed, if at all.

25. To add insult to injury, Stonebridge often does not supply the gift card or rebate

initially offered to entice the consumer.

26. Once consumers discover these unexplained and unauthorized charges, and then

contact Defendant Stonebridge to determine their source and demand a refund, Defendant

Stonebridge steadfastly denies their claims and, without explanation or proof, contends that they

consented to the charges.

27. Even more abhorrently, Defendant Stonebridge refuses to allow customers to

cancel their Membership Program subscriptions. Defendant Stonebridge extorts further profits

from consumers by, among other methods, failing to answer the phone at the listed customer

service telephone number, claiming to be unable to find a customer’s membership in the

computer system (even where the customer has statements indicating current charges from

Stonebridge), arguing with the customer regarding consent allegedly given, claiming that

memberships can only be cancelled on specific days of the month and denying cancellation

requests given on those specified days, and, most disturbingly, indicating that the membership

has been cancelled, only to continue monthly billing.

III. J.C. Penney’s History of Data Passing and Fraudulent Membership Programs

28. Defendant J.C. Penney is a chain department store with locations throughout the

United States. Defendant J.C. Penney partners with Defendant Stonebridge to offer five

Membership Programs exclusive to J.C. Penney Customers: Fun Family Rewards, Fun Family

Select, Perfect Home Rewards, Perfect Home Select, and Savings Solutions, as well as enrolling

8

customers in other non-exclusive Stonebridge programs such as LeisurePlus. Consumers have

complained about the enrollment and billing practices of each and every one of these

Membership Programs.

29. Defendant J.C. Penney enrolls consumers in Membership Programs after both

telephone and online purchases by its customers. J.C. Penny also facilitates Defendant

Stonebridge enrolling J.C. Penny customers over the phone by providing Stonebridge with its

customers’ contact and billing information for telemarketing purposes.

30. After a customer orders by telephone, Defendant J.C. Penney’s telemarketers

enroll the customer in one or more of the Membership Programs without the customer’s express

and informed consent. The telemarketers are trained to speak quickly, and use a uniform script

that fails to fully disclose the terms and conditions of enrollment in the Membership Programs.

Defendant J.C. Penney and its telemarketers do not obtain the informed consent of consumers

before enrolling them in the Membership Programs, and even enroll customers against their

express wishes.

31. After customers place online orders, Defendant J.C. Penney uses negative option

billing and fictitious rebate offers to deceptively enroll consumers in Membership Programs

without their consent. Importantly, whether by negative option or by fictitious rebate offer,

Defendant J.C. Penney does not disclose the full terms of enrollment in its Membership

Programs to its online customers.

32. Whether ordering by phone or online, customers do not need to provide their

contact and billing information to Defendant Stonebridge for a Membership Program because

Defendant J.C. Penney has already done so. Further, Defendant J.C. Penney is fully aware that

9

its customers are not fully informed of the terms of enrollment in the Membership Programs, and

do not consent to the enrollment.

33. Defendant J.C. Penney substantially profits through its illegal enrollment

practices and its partnership with Defendant Stonebridge. Defendant J.C. Penney receives a

percentage of the revenue obtained from each customer it enrolls or facilities the enrollment of in

Defendant Stonebridge’s membership programs. Defendant J.C. Penney has a vested interest in

perpetuating and expanding the fraud that Defendant Stonebridge perpetrates on consumers.

Facts Relating to Plaintiff Bernadine Sims

34. In or around 2004, Plaintiff Sims ordered a product over the telephone from

Defendant J.C. Penney, using her J.C. Penney credit card. As a result of making this purchase,

Plaintiff later became enrolled in a “free trial” offer of Stonebridge’s LeisurePlus Membership

Program.

35. In the days following her phone call and purchase with Defendant J.C. Penny, a

telemarketer from Defendant Stonebridge called her. Stonebridge had acquired her contact

information and purchase history from J.C. Penny, and used her recent purchase as an

inducement to “upsell” her additional products. Specifically, in describing the Stonebridge

product, the telemarketer misrepresented and/or omitted the price, the full terms of enrollment,

the negative option nature of the enrollment, and that Plaintiff would need to take affirmative

action to avoid being charged.

36. Based on the representations and omissions made by the telemarketer, Plaintiff

believed she was enrolling in a limited free trial of LeisurePlus, that her membership would

expire after the trial period ended, and that she could cancel her membership at any time.

10

37. Despite the representations made by Defendant J.C. Penney’s telemarketer,

Plaintiff’s enrollment in LeisurePlus renewed automatically at the end of her trial period, and she

has been charged a monthly enrollment fee on a continuing basis ever since. Defendant J.C.

Penny received and continues to receive compensation for charges placed on Plaintiff’s account

by Defendant Stonebridge.

38. Immediately upon realizing that she was being charged after the expiration of the

six-month trial, Plaintiff contacted Defendant Stonebridge to inquire about the basis for the

continued, unauthorized charges on her account. Defendant Stonebridge’s customer service

representative told Plaintiff that she had consented to automatic renewal of her membership at

the expiration of the trial period. Plaintiff was not aware of any automatic renewal provision,

and never consented to automatic renewal of any Stonebridge Membership Program.

39. After realizing she had been auto-enrolled without her permission, she attempted

to actually use the service so as to gain some benefit from the unauthorized charges. However,

when Plaintiff attempted to use her LeisurePlus membership to receive a discount while

traveling, in direct contradiction to what Plaintiff was originally told, Defendant Stonebridge’s

customer service representative informed her that such benefits were not provided by her

enrollment in LeisurePlus.

40. After discovering that she was still enrolled in LeisurePlus, and that it provided

her with no benefit, Plaintiff repeatedly tried to cancel her membership. However, Stonebridge

informed her that she could only cancel her membership on the same day of the month on which

she enrolled initially—the 18th of the month.

41. Despite the completely arbitrary nature of this alleged requirement, Plaintiff

followed Defendant Stonebridge’s instructions and attempted to cancel her membership on the

11

18th of the month. When she did call on the 18th, Defendant Stonebridge’s telemarketers told

Plaintiff Sims that she could not cancel her membership at that time—despite their previous

assurances to the contrary.

42. Since attempting to cancel on the 18th, Plaintiff has attempted to cancel her

membership on at least four separate occasions, to no avail. Plaintiff is still enrolled in

LeisurePlus, has yet to receive any benefits from her enrollment, and is still charged monthly for

her enrollment.

43. Since being enrolled in 2004, Plaintiff has been charged between $6.00 and $9.00

each and every month for membership in the LeisurePlus Membership Program—a membership

she became enrolled in without giving her informed consent, which she has never used, and has

repeatedly tried to cancel.

44. Defendant Stonebridge has yet to refund any of the hundreds of dollars owed to

Plaintiff Sims.

Amount in Controversy

45. Plaintiff makes no specific allegation that the amount in controversy (including

requests for attorneys’ fees, injunctive relief, etc.) exceeds any specific amount. Specifically,

Plaintiff makes no allegations that the amount in controversy exceeds $5,000,000.

Class Allegations

46. Plaintiff brings this action pursuant to 735 ILCS 5/2-801 on behalf of herself and

a Class and four SubClasses:

Stonebridge Class: Plaintiff brings this action on behalf of herself and a Class of

similarly situated individuals, defined as follows:

12

All individuals who were enrolled in a Stonebridge Membership Program and who never utilized or otherwise benefited from Stonebridge’s Membership Programs.

Cancellation Subclass: Plaintiff brings this action on behalf of herself and a

SubClass of similarly situated individuals, defined as follows:

All individuals who were enrolled in a Stonebridge Membership Program and attempted to cancel their membership and were subsequently charged by Stonebridge for the Membership Program.

Bank Account Subclass: Plaintiff brings this action on behalf of herself and a SubClass

of similarly situated individuals, defined as follows:

All Stonebridge Class Members who had monthly membership fees debited directly from their bank accounts.

J.C. Penney SubClass: Plaintiff brings this action on behalf of herself and a SubClass of

similarly situated individuals, defined as follows:

All Stonebridge Class Members who were enrolled in a Stonebridge Membership Program after purchasing a product from Defendant J.C. Penney Company, Inc.

Illinois SubClass: Plaintiff Sims brings this action on behalf of herself and a

SubClass of similarly situated individuals, defined as follows:

All Stonebridge Class Members who are citizens of the State of Illinois.

The following people are excluded from the Class and SubClasses: 1) any Judge or

Magistrate presiding over this action and members of their families; 2) Defendants, Defendants’

subsidiaries, parents, successors, predecessors, and any entity in which the Defendant or its

parents have a controlling interest and its current or former employees, officers and directors; 3)

persons who properly execute and file a timely request for exclusion from the Class and

SubClasses; 4) the legal representatives, successors, or assigns of any such excluded persons;

13

and 5) all persons who have previously had claims similar to those alleged herein finally

adjudicated or who have released their claims against Defendants.

47. Hereinafter, the above-described Class and SubClasses shall be collectively

referred to as “Classes” for purposes of this Complaint.

48. Numerosity: The exact number of the members of the Classes is unknown and

not available to the Plaintiff, but it is clear that individual joinder is impracticable. On

information and belief, Defendants have deceived thousands of consumers who fall into the

definition set forth in the Classes. Members of the Classes can be identified through Defendants’

records.

49. Typicality: Plaintiff’s claims are typical of the claims of other members of the

Classes, as Plaintiff and other members of the Classes sustained damages arising out of the

wrongful conduct of Defendants, based upon the same representations made uniformly to

Plaintiff and the public.

50. Adequate Representation: Plaintiff will fairly and adequately represent and

protect the interests of the Classes, and has retained counsel competent and experienced in

complex class actions. Plaintiff has no interest antagonistic to those of the Classes, and

Defendants have no defenses unique to the Plaintiff.

51. Predominance and Superiority: This class action is appropriate for certification

because class proceedings are superior to all other available methods for the fair and efficient

adjudication of this controversy, since joinder of all parties is impracticable. The damages

suffered by the individual members of the Classes will likely be relatively small, especially given

the burden and expense of individual prosecution of the complex litigation necessitated by the

actions of Defendants. It would be virtually impossible for the individual members of the

14

Classes to obtain effective relief from Defendants’ misconduct. Even if members of the Classes

could sustain such individual litigation, it would still not be preferable to a class action, because

individual litigation would increase the delay and expense to all parties due to the complex legal

and factual controversies presented in this Complaint. By contrast, a class action presents far

fewer management difficulties and provides the benefits of single adjudication, economy of

scale, and comprehensive supervision by a single Court. Economies of time, effort, and expense

will be fostered and uniformity of decisions ensured.

52. Commonality: There are many questions of law and fact common to the claims

of Plaintiff and the Classes, and those questions predominate over any questions that may affect

individual members of the Classes. Common questions for the Classes include, but are not

limited to the following:

(a) Whether Defendants’ conduct described herein violates the Illinois

Consumer Fraud and Deceptive Business Practices Act (815 ILCS 505/1 et seq.);

(b) Whether Defendants’ conduct described herein violates the Automatic

Contract Renewal Act (815 ILCS 601/1 et seq.);

(c) Whether Defendants’ conduct described herein violates the Electronic

Funds Transfer Act (15 U.S.C. §§ 1693e, et seq.);

(d) Whether Defendant Stonebridge’s conduct described herein constitutes

unjust enrichment;

(e) Whether Defendants’ conduct described herein constitutes negligence;

(f) Whether Defendants’ conduct described herein constitutes fraud by

omission;

15

(g) Whether Defendant J.C. Penney’s conduct described herein constitutes

breach of contract;

(h) Whether Defendant Stonebridge’s conduct described herein constitutes

breach of contract.

COUNT I Violation of the Illinois Consumer Fraud and Deceptive Business Practices Act

(815 ILCS 505/1 et seq.) (On Behalf of the Plaintiff and the Classes)

53. Plaintiff incorporates by reference the foregoing allegations.

54. The Illinois Consumer Fraud and Deceptive Business Practices Act (“ICFA”)

(815 ILCS 505/1 et seq.) protects both consumers and competitors by promoting fair competition

in commercial markets for goods and services.

55. The ICFA prohibits any unlawful, unfair, or fraudulent business acts or practices

including the employment of any deception, fraud, false pretense, false promise,

misrepresentation, or the concealment, suppression, or omission of any material fact.

56. As described herein, Defendants’ continuing practice of charging, and facilitating

the charging of, the credit cards and bank accounts of members of the Classes for Stonebridge’s

Membership Programs without authorization, constitutes a deceptive act or practice in violation

of the ICFA.

57. The price, terms, and duration of a consumer product or service are material terms

of any transaction as they are likely to affect a consumer’s choice of, or conduct regarding,

whether to purchase a product or service. Any deception related to the price, terms, and duration

of a consumer product are materially misleading.

16

58. Defendants’ omission of the price, terms, and duration of the Membership

Programs, or the fact that Plaintiff and the Classes would be charged at all, was an act likely to

mislead Plaintiff and members of the Classes acting reasonably under the circumstances and

constitutes an unfair and deceptive trade practice in violation of the ICFA.

59. Defendant J.C. Penney violated the “unfair” prong of the ICFA by accepting the

J.C. Penney SubClass members’ confidential billing information with the intent to transfer such

information to Defendant Stonebridge in furtherance of their fraudulent and deceptive scheme.

The injuries caused by Defendant J.C. Penney’s conduct are not outweighed by any

countervailing benefits to consumers or competition, and the members of the J.C. Penney

SubClass could not have reasonably avoided the injuries they sustained.

60. Defendant J.C. Penney intended that Plaintiff Sims and members of the J.C.

Penney SubClass would rely on its deceptive conduct and submit payment information.

61. Defendant Stonebridge violated the “unfair” prong of the ICFA by accepting the

Class members’ confidential billing information without express consent after Defendant J.C.

Penney, and its other Merchant Partners, which induced members of the Classes to submit the

information for unrelated products or services, and omitted the fact that such information would

then be passed on to Defendant Stonebridge and used for purposes of levying unauthorized

charges. The injuries caused by Defendant Stonebridge’s conduct are not outweighed by any

countervailing benefits to consumers or competition, and the members of the Classes could not

reasonably have avoided the injuries they sustained.

62. Defendants knew that Plaintiff and the members of the Classes would be unaware

that by submitting their payment information to Defendant J.C. Penney, and other Merchant

17

Partners, that J.C. Penney, and other Merchant Partners would then pass that information to

Defendant Stonebridge.

63. Defendants violated the “unfair” prong of the ICFA because their actions caused

substantial injury to consumers by causing their credit cards and bank accounts to be charged and

debited without consent after inducing consumers to submit their information through deceptive

marketing. The injury caused by Defendants’ conduct is not outweighed by any countervailing

benefits to consumers or competition, and the injury is one that consumers themselves could not

have reasonably avoided.

64. Defendants have also violated the “fraudulent” prong of the ICFA in that their

statements, advertisements, and representations that consumers have consented to be charged for

the Membership Programs are false, and were likely to deceive a reasonable consumer.

65. Defendants have violated the “unlawful” prong of the ICFA in that Defendants’

conduct violated the Automatic Contract Renewal Act (815 ILCS 601/1 et seq.) (See Count II),

and the Electronic Funds Transfer Act (15 U.S.C. §§ 1693e, et seq.) (See Count III).

66. Defendants intended that Plaintiff and the Classes would rely on Defendants’

material misrepresentations, and would submit their credit card numbers and bank account

information to Defendants.

67. Plaintiffs and the Classes have suffered harm as a proximate result of Defendants’

violations of law and the wrongful conduct alleged herein.

68. Plaintiff and the Classes have suffered damages in the form of monies lost.

69. Defendants’ deception occurred during and after the marketing and sale of

consumer goods and services, and therefore occurred in the course of trade and commerce.

18

70. Plaintiff and the members of the Classes seek an order (1) permanently enjoining

Defendants from continuing to engage in unfair and unlawful conduct; (2) requiring Defendants

to pay actual, compensatory and punitive damages pursuant to 815 ILCS 505/10a(a); (3)

requiring Defendants to make full restitution of all funds wrongfully obtained; and (4) requiring

Defendants to pay interest, attorneys’ fees, and costs pursuant to 815 ILCS 505/10a(c).

COUNT II Violation of the Automatic Contract Renewal Act

(815 ILCS 601/1 et seq.) (On Behalf of the Illinois SubClass)

71. Plaintiff Sims incorporates by reference the foregoing allegations.

72. The Automatic Contract Renewal Act (“ACRA”) (815 ILCS 601/1, et seq.)

requires an entity enrolling a consumer in an automatically renewing contract to provide the

renewal provision to the consumer in a clear and conspicuous manner. Failure to provide the

provision in a clear and conspicuous manner deems the automatic renewal provision

unenforceable by the party who prepared the contract or directed its preparation.

73. Representations made by Defendants failed to notify Plaintiff Sims and the

Illinois SubClass in a clear and conspicuous manner of the recurring nature of the charges

Defendants assess and that the charges would be indefinitely renewed on a monthly basis.

74. Defendants intentionally conceal and misrepresent the nature of the charges,

including the actual cost and the frequency with which members of the Illinois SubClass will be

charged.

75. Defendants’ violations of the ACRA constitute unlawful practices under the

Consumer Fraud and Deceptive Business Practices Act (815 ILCS 505/1, et seq.).

19

76. Plaintiff, on her own behalf, and on behalf of the Illinois SubClass, seeks: (1) an

order requiring Defendants to immediately stop the unlawful practices stated in this Complaint,

and preventing Defendants from enforcing any automatic renewal provisions against Plaintiffs

and the Illinois SubClass; (2) damages; (3) interest; and (4) attorney’s fees and costs.

COUNT III Violations of the Electronic Funds Transfer Act

(15 U.S.C. § 1693e) (On Behalf of the Bank Account SubClass)

77. Plaintiff incorporates by reference the foregoing allegations.

78. As described herein, Defendant Stonebridge initiated, and Defendant J.C. Penney

profited from, electronic transfers of funds for unauthorized Membership Programs from the

bank accounts of Plaintiff and the Bank Account SubClass on a recurring basis, at substantially

regular intervals, without first obtaining written authorization from them or providing them with

a copy of any such purported authorization.

79. Therefore, Defendants have violated 15 U.S.C. § 1693e.

80. Plaintiff and the members of the Bank Account SubClass have suffered damages

as a result of Defendants’ violations of 15 U.S.C. § 1693e. Accordingly, pursuant to 15 U.S.C.

§ 1693m, Plaintiff and the members of the Bank Account SubClass seek actual damages,

statutory damages, reasonable costs and attorneys’ fees, and an injunction permanently enjoining

Defendants from continuing to engage in the unlawful conduct alleged herein.

COUNT IV Restitution/Unjust Enrichment (in the alternative to breach of contract)

(On Behalf of the Plaintiff and the Class as Against Defendant Stonebridge Only)

81. Plaintiff incorporates by reference the foregoing allegations, excluding paragraphs

119 through 126.

20

82. Plaintiff and members of the Classes have no valid contractual relationship with

Defendant Stonebridge.

83. Stonebridge knowingly and without authorization charged and debited the credit

and bank accounts of Plaintiff and the members of the Classes for its Membership Programs.

84. As a result, and despite having no valid or legal basis to do so, Defendant

Stonebridge unjustly received and continues to receive monetary benefits in the form of

Membership Program fees charged to those accounts.

85. Defendant Stonebridge appreciates and/or has knowledge of those benefits.

86. Plaintiff and the Classes have no adequate remedy at law against Stonebridge.

87. Under principles of equity and good conscience, Defendant Stonebridge should

not be permitted to retain the money belonging to Plaintiff and the members of the Classes that

Defendant Stonebridge unjustly received as a result of its unlawful actions.

88. Plaintiff, individually and on behalf of the Classes, seeks restitution for Defendant

Stonebridge’s unlawful conduct, as well as interest, costs, and reasonable attorneys’ fees.

COUNT V Negligence

(On Behalf of the Plaintiff and the Classes)

89. Plaintiff incorporates by reference the foregoing allegations.

90. In acquiring Plaintiff Sims’s and J.C. Penney SubClass Members’ credit card and

bank account information, Defendant J.C. Penney had a duty to inform Plaintiff Sims and J.C.

Penney SubClass members of the purposes for which such information would be used.

91. In acquiring Plaintiff’s and the Class Members’ credit card and bank information,

Defendant Stonebridge had a duty to only place charges on those accounts with the informed and

explicit consent of Plaintiff and the members of the Classes.

21

92. By facilitating and profiting from the misuse of Plaintiff Sims’s and the J.C.

Penney SubClass Members’ information, and failing to adequately protect Plaintiff Sims’s and

the J.C. Penney SubClass Members’ information, Defendant J.C. Penney was grossly negligent

and departed from all reasonable standards of care.

93. By failing to obtain Plaintiff’s and the Class Members’ informed express consent

to place charges on their accounts, Defendant Stonebridge was grossly negligent and departed

from all reasonable standards of care.

94. Plaintiff Sims’s and the J.C. Penney SubClass Members’ injuries were reasonably

foreseeable as Defendant J.C. Penney was aware when it obtained Plaintiff Sims’s and the J.C.

Penney SubClass Members’ information that it would subsequently transfer such information to

Defendant Stonebridge, and that Stonebridge would misuse the information to fraudulently enroll

and renew Plaintiff Sims and the J.C. Penney SubClass Members in its Membership Programs.

95. Plaintiff’s and Class Members’ injury was reasonably foreseeable as Defendant

Stonebridge was aware that it had failed to acquire informed and explicit consent to charge their

credit card and bank accounts for its Membership Programs.

96. Neither Plaintiff nor the other members of the Classes contributed to the

Defendants placing unauthorized charges on their accounts.

97. As a direct and proximate result of Defendants’ failure to exercise reasonable care

and their acts of placing charges on the accounts of Plaintiff and members of the Classes without

authorization, Plaintiff and members of the Classes were injured in the form of monies lost.

COUNT VI Fraud by Omission

(On Behalf of the Plaintiff and the Classes)

98. Plaintiff incorporates by reference the foregoing allegations.

22

99. Based on Defendants’ material omissions, Plaintiff and the members of the

Classes did not reasonably expect to be charged by Defendant Stonebridge for its Membership

Programs without authorization.

100. Defendant J.C. Penney knew that it did not have informed and explicit consent to

transfer Plaintiff Sims and the J.C. Penney Class Members’ credit card and bank information to

Defendant Stonebridge for indefinite enrollment in its Membership Programs.

101. Defendant Stonebridge knew that it did not have informed and explicit consent to

charge Plaintiff and members of the Classes for its Membership Programs.

102. Defendant J.C. Penney concealed from and failed to disclose to Plaintiff Sims and

the J.C. Penney SubClass Members that it would sell or otherwise transfer their credit card or

bank information to Defendant Stonebridge for indefinite enrollment in Membership Programs

without consent.

103. Defendant Stonebridge concealed from and failed to disclose to Plaintiff and to

members of the Classes that it would charge them repeatedly and indefinitely for its membership

programs without consent.

104. Defendant J.C. Penney was under a duty to disclose to Plaintiff Sims and the

members of the J.C. Penney SubClass that it intended to sell or transfer their credit card or bank

account information to Defendant Stonebridge for indefinite enrollment in Membership

Programs because: (1) Defendant J.C. Penney was in a superior position to know the true state of

facts about its possession of Plaintiff Sims’s and the J.C. Penney SubClass Members’ credit card

and bank account information and the terms of its contract for sale or transfer of such

information with Defendant Stonebridge; (2) Plaintiff Sims and the J.C. Penney SubClass

Members could not reasonably have been expected to learn or discover that J.C. Penney

23

representatives would offer Stonebridge products, and intended to transfer Plaintiff Sims’s and

the J.C. Penney SubClass Members’ account information to Defendant Stonebridge for indefinite

enrollment in Membership Programs; and (3) Defendant J.C. Penney knew that Plaintiff Sims

and the J.C. Penney SubClass Members could not reasonably have been expected to learn or

discover that J.C. Penney representatives would offer Stonebridge products, and intended to

transfer Plaintiff Sims’s and the J.C. Penney SubClass Members’ account information to

Defendant Stonebridge.

105. Defendant Stonebridge was under a duty to disclose to Plaintiffs and the members

of the Classes that it intended to charge their accounts for its Membership Programs because: (1)

Defendant Stonebridge was in a superior position to know the true state of facts about its

possession of Plaintiff’s and Class Members’ credit and bank card information and the terms of

its Membership Programs; (2) Plaintiff and the Class Members could not reasonably have been

expected to learn or discover that Defendant Stonebridge was in possession of their account

information and that Stonebridge intended to place charges on those accounts without

authorization; and (3) Defendant Stonebridge knew that Plaintiff and the Class Members could

not reasonably have been expected to learn or discover that Defendant Stonebridge was in

possession of their account information and that Defendant Stonebridge intended to place

charges on those accounts without authorization.

106. The facts concealed or not disclosed by Defendants to Plaintiff and the members

of the Classes are material in that a reasonable consumer would have considered them to be

important in deciding whether to allow access to their billing information and whether to enroll

in Defendant Stonebridge’s Membership Programs.

24

107. Plaintiff and the Classes justifiably relied on the omissions of Defendants to their

detriment.

108. The detriment is evident from the submission of Plaintiff’s and the members of

the Classes’ credit card and bank information and the levying of unauthorized charges on the

accounts of Plaintiff and members of the Classes, and the monies lost as a result.

109. As a direct and proximate result of Defendants’ misconduct, Plaintiff and the

Classes have suffered and will continue to suffer actual damages in the form of monies taken by

Defendants.

COUNT VII Breach of Contract

(On Behalf of Plaintiff Sims and the J.C. Penney SubClass as Against Defendant J.C. Penny Only)

110. Plaintiff Sims incorporates by reference the forgoing allegations, excluding

paragraphs 81 through 88.

111. J.C. Penney on the one hand, and Plaintiff Sims and members of the J.C. Penney

SubClass on the other, entered into valid and enforceable contracts whereby members of the J.C.

Penney SubClass submitted their confidential payment information to buy products sold by

Defendant J.C. Penney. When making these purchases, Plaintiff and members of the J.C. Penney

SubClass agreed to only be billed a specific dollar amount for those products or services.

112. A material term of those contracts required Defendant J.C. Penney to only charge

Plaintiff and members of the J.C. Penney SubClass the agreed upon purchase price of the

products or services that the J.C. Penney SubClass wished to purchase.

113. A material term of the contract entered into by Plaintiff Sims and the J.C. Penney

SubClass with Defendant J.C. Penney required that J.C. Penney only share Plaintiff Sims’s and

25

J.C. Penney SubClass members’ confidential payment information with those persons or entities

expressly authorized to receive it.

114. Plaintiff and other members of the J.C. Penney SubClass did not assent to

Defendant J.C. Penney transmitting their confidential payment information to Defendant

Stonebridge for the purpose of indefinite enrollment in Membership Programs, they did not

assent to being billed for any additional charges, and they did not reasonably expect that they

would be billed for any undisclosed charges, including indefinite enrollment in Defendant

Stonebridge’s Membership Programs.

115. Plaintiff and members of the J.C. Penney SubClass did not enter into contracts

with Defendant Stonebridge for indefinite, non-cancellable, and automatically renewing

enrollment in Membership Programs.

116. Through their unlawful conduct alleged herein, including transmitting Plaintiff’s

and the J.C. Penney SubClass members’ confidential payment information to Defendant

Stonebridge without full and informed consent, Defendant J.C. Penney materially breached the

terms of their contracts with Plaintiff and members of the J.C. Penney SubClass.

117. As a direct and proximate result of Defendant J.C. Penney’s breaches alleged

herein, Plaintiff and other members of the J.C. Penney SubClass suffered damages in the form of

moneys lost.

118. Plaintiff Sims, individually and on behalf of the J.C. Penney SubClass, seeks to

recover all damages incurred as a result of Defendant J.C. Penney’s breach of their contracts, as

well as interest, costs, and reasonable attorneys’ fees.

26

COUNT VIII Breach of Contract

(On Behalf of Plaintiff Sims and the Cancellation SubClass as Against Defendant Stonebridge Only)

119. Plaintiff Sims incorporates by reference the forgoing allegations, excluding

paragraphs 81 through 88.

120. Stonebridge on the one hand, and Plaintiff Sims and members of the Cancellation

SubClass on the other, entered into a contract whereby members of the Cancellation SubClass

were enrolled a Stonebridge Membership Program and were charged a monthly fee.

121. A material term of those contracts required Defendant to stop charging Plaintiff

and members of the Cancellation SubClass if they cancelled the Membership Program.

122. Plaintiff and other members of the Cancellation SubClass took steps to cancel

their enrollment in the Membership Programs by directly contacting Stonebridge to stop future

charges.

123. Thereafter, Stonebridge continued to charge members of the Cancellation

SubClass in the face of their express request to cancel.

124. By charging Cancellation SubClass Members’ following their request to cancel,

Defendant Stonebridge materially breached the terms of its contracts with Plaintiff and members

of the Cancellation SubClass.

125. As a direct and proximate result of Stonebridge’s breach alleged herein, Plaintiff

and other members of the Cancellation SubClass suffered damages in the form of monies lost.

126. Plaintiff Sims, individually and on behalf of the Cancellation SubClass, seeks to

recover all damages incurred as a result of Defendant Stonebridge’s breach, as well as interest,

costs, and reasonable attorneys’ fees.

27

COUNT IX Restitution/Unjust Enrichment (in the alternative to breach of contract) (On Behalf of the Plaintiff and the Cancellation SubClass as Against

Defendant Stonebridge Only)

127. Plaintiff incorporates by reference the foregoing allegations, excluding paragraphs

110 through 126.

128. Plaintiff and members of the Cancellation SubClass had no valid contractual

relationship with Defendant Stonebridge and/or any contract with Defendant Stonebridge was

terminated.

129. Stonebridge knowingly and without authorization charged and debited the credit

and bank accounts of Plaintiff and the members of the Cancellation SubClass for its Membership

Programs after Cancellation SubClass Members affirmatively cancelled their enrollment.

130. As a result of Stonebridge’s post-cancellation charges, and despite having no

valid or legal basis to do so, Defendant Stonebridge unjustly received and continues to receive

monetary benefits in the form of Membership Program fees charged to those accounts.

131. Defendant Stonebridge appreciates and/or has knowledge of those benefits.

132. Plaintiff and the Cancellation SubClass Members have no adequate remedy at law

against Stonebridge.

133. Under principles of equity and good conscience, Defendant Stonebridge should

not be permitted to retain the money belonging to Plaintiff and the members of the Cancellation

SubClass that Defendant Stonebridge unjustly received as a result of its unlawful actions.

134. Plaintiff, individually and on behalf of the Cancellation SubClass, seeks

restitution for Defendant Stonebridge’s unlawful conduct, as well as interest, costs, and

reasonable attorneys’ fees.

28

PRAYER FOR RELIEF

WHEREFORE, Plaintiff Bernadine Sims, on behalf of herself and the members of the

Class and SubClasses, prays for the following relief:

a. Certify this case as a class action on behalf of the Classes defined above, appoint

Plaintiff as the Class representatives, and appoint her counsel as Class Counsel;

b. Declare that Defendants’ actions, as set out above, violate 815 ILCS 505/1, et

seq., 815 ILCS 601/1, et seq., and 15 U.S.C. § 1693e, and constitute unjust enrichment,

negligence, fraud by omission, and breach of contract;

c. Award all economic, monetary, actual, consequential, statutory and compensatory

damages caused by Defendants’ conduct;

d. Award Plaintiff’s and the Classes civil penalties and/or punitive damages for

violations of the above-cited statutes and law;

e. Award restitution against Defendants for all money to which Plaintiff and the

Classes are entitled in equity;

f. Award Plaintiff and the Classes reasonable costs and attorneys’ fees;

g. Award Plaintiff and the Classes pre-and post-judgment interest;

h. Enter judgment for injunctive, statutory, and/or declaratory relief as is necessary

to protect the interests of Plaintiff and the Classes; and,

i. Award such other and further relief as equity and justice may require.