Schwab Files Legal Complaint Against TD Waterhouse Group, Inc. Alleging False and Misleading Advertising
15 March 2005 - 5:23AM
PR Newswire (US)
Schwab Files Legal Complaint Against TD Waterhouse Group, Inc.
Alleging False and Misleading Advertising SAN FRANCISCO, March 14
/PRNewswire-FirstCall/ -- The Charles Schwab Corporation today
filed suit against the TD Waterhouse Group accusing it of a
"pattern of deceptive, misleading and patently false advertising."
The complaint, filed in San Francisco County Superior Court,
contends a series of TD Waterhouse ads represent a scheme to
mislead both existing and prospective Schwab clients and the
general public and to disparage Schwab's service and value.
According to the suit, in recent years TD Waterhouse has attempted
to compete with Schwab, engaging in nationwide advertisement
campaigns which falsely and misleadingly disparage Schwab's
brokerage services and create the impression that Schwab's pricing
is similar to a full commission firm rather than to those of TD
Waterhouse and other discount brokers. Commenting on the complaint,
Charles R. Schwab, Chairman and CEO said, "TD has been running
millions of dollars of advertising that misleads investors and
sullies our reputation with statements that are neither accurate
nor fair. We are approaching our 30th year as the leader in the
discount brokerage business, with a brand and a reputation that
stands for good value and high quality service. This kind of
disparagement simply crosses the line of honesty and fair play."
The complaint notes that TD Waterhouse had agreed in a written
contract to stop its false claims and disparaging descriptions of
Schwab, but instead ran the misleading ad at least 28 additional
times in violation of the agreement. "Before pursuing this legal
action, Schwab urged TD Waterhouse to tell the truth in its ads,"
said Bruce L. Simon of the law firm Cotchett, Pitre, Simon &
McCarthy of Burlingame, California, Schwab's counsel on the case.
"They agreed to stop, acknowledging the inaccuracy of their
advertisements. However, instead of honoring their promise, they
continue to make false statements, leaving Schwab no choice but to
pursue this case." Since 1975, Schwab has been one of the leading
innovators in lower-cost investing, providing high-quality
investing services with low transaction costs. The suit accuses TD
Waterhouse of fraud and deceit, unfair competition, false
advertising, disparagement of reputation, trade libel and breach of
contract. The complaint seeks damages and an injunction to stop the
advertisements. About The Charles Schwab Corporation The Charles
Schwab Corporation (NYSE / Nasdaq: SCH), through its operating
subsidiaries, provides securities brokerage and financial services
to individual investors and the independent investment advisors who
work with them. With over 7 million individual investor accounts
and more than $1 trillion in client assets, The Charles Schwab
Corporation is one of the nation's largest financial services
firms. Its subsidiary Charles Schwab & Co., Inc. (member SIPC)
provides a complete range of investment services and products,
including an extensive selection of mutual funds; financial
planning and investment advice; retirement plans; referrals to
independent fee-based investment advisors; and custodial,
operational and trading support for independent fee-based
investment advisors. Its subsidiary Charles Schwab Bank, N.A.
(member FDIC and Equal Housing Lender) provides banking products
and services. The Corporation's other operating subsidiaries
include U.S. Trust Corporation (member FDIC) and CyberTrader(R),
Inc. (member SIPC). These companies' Web sites can be reached at
http://www.schwab.com/, http://www.schwabbank.com/,
http://www.ustrust.com/, and http://www.cybertrader.com/.
DATASOURCE: Charles Schwab CONTACT: Greg Gable of The Charles
Schwab Corporation, +1-415-636-5847 Web site:
http://www.schwab.com/
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