Seven Leading Publishers Sue on Subscription Fraud Conspiracy

Seven Leading Publishers Sue on Subscription Fraud Conspiracy

July 21, 2006

 

    BOSTON, July 21 /Xinhua-PRNewswire/ -- Seven leading
scientific, technical and medical publishers -- American
Chemical Society, American Institute of Physics, Blackwell
Publishing, Inc., Elsevier, Inc., Taylor & Francis (a
subsidiary of Informa Plc.), Springer Science and Business
Media LLC (part of Springer Science + Business Media
Group), and Wiley Periodicals, Inc. and Wiley-Liss, Inc.
(subsidiaries of John Wiley & Sons, Inc.) -- today
announced they have filed suit against Commax Worldwide, a
California-based subscription agency, its subsidiary Commax
Technologies, Inc., and nine individuals including the
president of Commax Technologies, Henry Chen.  The
publishers allege that the defendants are engaged in a
massive scheme of subscription fraud. 

    The principal defendant, Commax Worldwide, operates a
subscription agency serving libraries and other
institutions by acting as an intermediary in handling their
subscriptions to scholarly journals.  Its customers are
primarily in Taiwan and elsewhere in East Asia.  As an
agency, it is obligated to identify the subscriptions it
orders as institutional subscriptions bearing the normal
institutional price. The publishers' complaint, however,
accuses Commax of obtaining subscriptions to plaintiffs'
scientific, technical, and medical journals at deeply
discounted individual subscriber rates under false
pretenses, and reselling them to institutional clients at
the institutional rate.  The individual defendants,
including Henry Chen, participated in this by subscribing
to journals, often using false names and addresses, and
turning over the journals upon receipt to Commax.  The
publishers estimate their damages from this conspiracy in
the millions of dollars over the last few years. 

    "The significance of this lost revenue to
scholarship cannot be overstated," says Roy Kaufman,
Legal Director of John Wiley & Sons, parent corporation
of two of the plaintiffs.  "For all of us, journal
subscription income is crucial, and enables us to fund the
publications that foster research and the dissemination of
knowledge.  Furthermore, scholarly societies such as the
American Chemical Society and the American Institute of
Physics depend on subscription revenue for providing
critical services to their member scientists.  The kind of
wholesale theft committed by Commax and its co-conspirators
hurts all of these efforts."

    The complaint has been filed in the United States
District Court for the Northern District of California
(Docket# 064414), where all of the defendants are located. 
It alleges fraud, misrepresentation, breach of contract,
conversion, violation of California's Unfair Competition
Act and violation of the federal Racketeer Influenced and
Corrupt Organizations Act.  The publishers seek damages and
injunctive orders against future misconduct, among other
relief.

    About the American Institute of Physics.  The American
Institute of Physics is a nonprofit corporation and a
federation of learned societies chartered in 1931 for the
purpose of promoting the advancement and diffusion of the
knowledge of physics and its application to human welfare. 
Its mission is to serve physics, astronomy and related
fields of science and technology by serving its member
societies, their associates, scientists, educators, R&D
leaders and the general public with programs, services and
publications.  Its Publishing Center is located in,
Melville, NY.  For more information on the American
Institute of Physics, please visit http://www.aip.org . 

    About the American Chemical Society.  The American
Chemical Society-the world's largest scientific society-is
a nonprofit organization chartered by the U.S. Congress and
a global leader in providing access to chemistry-related
research through its multiple databases, peer-reviewed
journals and scientific conferences. Its main offices are
in Washington, D.C., and Columbus, Ohio.  For more
information about The American Chemical Society, please
visit http://www.chemistry.org .

    About Blackwell Publishing.  Blackwell Publishing is
the world's leading society publisher, partnering with 665
academic and professional societies. Blackwell publishes
over 800 journals and, to date, has published more than
6,000 books, across a wide range of academic, medical, and
professional subjects. The company remains independent with
more than 950 staff members in offices in the US, UK,
Australia, China, Denmark, Singapore, Germany, and Japan.
Blackwell's mission as an expert publisher is to create
long-term partnerships with clients to enhance learning,
disseminate research, and improve the quality of
professional practice. For more information on Blackwell
Publishing, please visit: 
http://www.blackwellpublishing.com /
http://www.blackwell-synergy.com .

    About Elsevier.  Elsevier is a world-leading publisher
of scientific, technical and medical information products
and services. Working in partnership with the global
science and health communities, Elsevier's 7,000 employees
in over 70 offices worldwide publish more than 2,000
journals and 1,900 new books per year, in addition to
offering a suite of innovative electronic products, such as
ScienceDirect ( http://www.sciencedirect.com/ ), MD Consult
( http://www.mdconsult.com/ ), Scopus (
http://www.info.scopus.com/ ), bibliographic databases, and
online reference works.  Elsevier ( http://www.elsevier.com/
) is a global business headquartered in Amsterdam, The
Netherlands and has offices worldwide. Elsevier is part of
Reed Elsevier Group plc ( http://www.reedelsevier.com/ ), a
world-leading publisher and information provider. Operating
in the science and medical, legal, education and
business-to-business sectors, Reed Elsevier provides
high-quality and flexible information solutions to users,
with increasing emphasis on the Internet as a means of
delivery. Reed Elsevier's ticker symbols are REN (Euronext
Amsterdam), REL (London Stock Exchange), RUK and ENL (New
York Stock Exchange).
 
    About Taylor & Francis.  Taylor & Francis is
part of the academic division of Informa PLC. Informa is a
leading provider of specialist, high quality information to
the global academic & scientific, professional, and
commercial markets via publishing, events and performance
improvement. At the heart of every Informa product and
service is research-based, proprietary information for a
highly targeted audience. Informa publishes approximately
2,500 subscription based products and services, and 45,000
books. Worldwide, Informa produces over 10,000 events each
year powered by a marketing database of over 20 million
names. It has an unparalleled portfolio of brands including
Lloyds List, Routledge, Taylor and Francis, IIR and
Euroforum. Informa operates in 70 countries, employing
approximately 7,500 people in 150 offices. Informa is
listed on the London Stock Exchange. For more information
on Taylor & Francis please visit
http://www.taylorandfrancisgroup.com/ .

    About Springer Science+Business Media.  Springer
Science+Business Media ( http://www.springer.com ) is one
of the world's leading suppliers of scientific and
specialist literature.  It is the second-largest publishing
group in the science, technology, and medicine (STM) sector
and the largest business-to-business publisher in the
German-language area.  The group owns 70 publishing houses,
together publishing a total of 1,450 journals and more than
5,000 new books a year.  The group operates in over 20
countries in Europe, the USA, and Asia, and has some 5,000
employees.

    About John Wiley & Sons, Inc.  Founded in 1807,
John Wiley & Sons, Inc., provides must-have content and
services to customers worldwide. Its core businesses include
scientific, technical, and medical journals, encyclopedias,
books, and online products and services; professional and
consumer books and subscription services; and educational
materials for undergraduate and graduate students and
lifelong learners. Wiley has publishing, marketing, and
distribution centers in the United States, Canada, Europe,
Asia, and Australia. The Company is listed on the New York
Stock Exchange under the symbols JWa and JWb. Wiley's
Internet site can be accessed at http://www.wiley.com .

    For more information, please contact:

     Atty. William S. Strong, 
     Kotin, Crabtree & Strong, LLP
     Tel:   [phone]
     Email: [e-mail] 

SOURCE  Kotin, Crabtree & Strong, LLP