Parents Sue Educational Publisher Scholastic Alleging Misleading Billing, Marketing Scheme

    Plaintiffs Say the Company Illegally Traps Consumers Into a System of
                Receiving and Being Billed for Unwanted Items

    SEATTLE, Jan. 30 /PRNewswire/ -- Consumers filed a proposed nationwide
class-action lawsuit today against Scholastic, Inc. (Nasdaq: SCHL), claiming
the country's largest publisher of children's books dupes unsuspecting
consumers into a scheme to purchase unsolicited books and educational items.
    According to the complaint, Scholastic uses its marketing presence within
elementary schools to convince parents to purchase educational products, and
then bombards parents with unsolicited goods, demanding payment in violation
of state and federal law.
    Scholastic settled a charge brought by the FTC for similar actions in
2005.
    Under Washington state law, as well as in 14 other states, unsolicited
goods are deemed to be gifts with no obligation to pay for or return them.
    Nick Styant-Browne, lead attorney for the proposed class, believes that
there may be as many as 50,000 potential class members who have fallen victim
to what he calls "one of the most cynical marketing ploys I've witnessed."
    "Scholastic plays on parents' desire to help their children academically,"
said Styant-Browne. "Hiding behind this guise, we intend to show that
Scholastic hits parents with an unsolicited barrage of books and products
while holding out their hand demanding payment."
    According to the Federal Trade Commission (FTC) Web site, Scholastic is
required to fully disclose the terms of its book clubs to consumers following
suits filed by the FTC and the Missouri attorney general over its negative
option billing procedures.
    While negative option billing is not illegal, plaintiffs in this case
claim that when they tried to cancel their membership they were harassed,
deceived, intimidated, and threatened, the complaint states.
    Negative option billing requires the recipient to cancel an ongoing order
or they will continue to be sent and charged for new items.
    A news release issued by the Better Business Bureau states that the
consumer-rights organization has received more than 250 complaints about
Scholastic's tactics in one regional office alone.
    According to the complaint, named plaintiff Carly Alcombrack Hart
responded to an advertisement in a magazine offering free "Barbie and Friends"
books from Scholastic.  According to Hart, after receiving the free books,
Scholastic then sent unsolicited encyclopedias, which her husband and
co-plaintiff, Johnnie Hart, returned in a pre-paid company envelope.
    After sending back the encyclopedias, the Harts received a bill for the
returned items even though they no longer had them in their possession.  Soon
after the encyclopedia bill a multitude of other items began to arrive from
Scholastic -- each one unsolicited and each one with a bill.
    "We began receiving intimidating letters and calls from Scholastic for
items we never ordered," said Hart.  "It has gotten to the point in which we
are afraid to answer the phone since they call to browbeat us almost daily."
    According to Hart, the company has sent her account to a collection agency
and has threatened to provide a negative report to the National Credit
Reporting Agency, which may stay on her file for seven years.
    According to Hart, Scholastic continues to harass her family to this day
with constant telephone calls and statements demanding immediate payment.
    "We plan to show that Scholastic's policy of trapping consumers between
paying for unwanted items or having their credit negatively affected is
patently illegal," said Styant-Browne.  "We intend to stop the company from
engaging in this practice and compensate those already harmed by its illegal
actions."
    The lawsuit, filed in the U.S. District Court in Seattle by
Nick Styant-Browne of Hagens Berman Sobol Shapiro and Sim Osborn, managing
partner of Osborn Machler, seeks to represent and to recover money lost for
all those who received and were charged for unsolicited goods from Scholastic
in the United States.
    For more information and to view the complaint, please visit
http://www.hbsslaw.com .

    About Hagens Berman Sobol Shapiro
    Hagens Berman Sobol Shapiro is a law firm with offices in Seattle,
Cambridge, Los Angeles, and Phoenix. The firm has developed a nationally
recognized practice in class-action litigation.  The firm is co-lead counsel
in litigation to recover losses from Enron employees' retirement funds and
represented Washington and 12 other states in lawsuits against the tobacco
industry that resulted in the largest settlement in the history of litigation.
The firm also served as counsel in several other high-profile cases including
the Washington Public Power Supply litigation, which resulted in a settlement
of more than $850 million, and the $92.5 million settlement of The Boeing
Company litigation.  Other notable cases include litigation involving the
Exxon Valdez oil spill; Louisiana Pacific Siding; Morrison Knudsen; Piper
Jaffray; Nordstrom; Boston Chicken; Noah's Bagels; TAP Pharmaceutical's Lupron
litigation; and SmithKline Beecham's Paxil Litigation.

    About Sim Osborn
    Simeon Osborn is the managing partner in the law firm of Osborn Machler,
which specializes in personal injury, products liability, aircraft litigation
and civil litigation. Osborn has 20 years of experience in litigation. Osborn
has successfully represented clients against governmental agencies,
multinational corporations and banks. He was the lead lawyer in Motamed v.
The Port of Seattle which held the Port liable for a recent shooting in the
SeaTac Airport parking garage and caused the Port to modify the lighting and
design of the parking garage. Osborn was selected for inclusion in the
biannual Best Lawyers in America list, given the highest rating by his peers
in the Martindale-Hubbell survey, included in the Washington Law & Politics'
Super Lawyers list, voted into the American Board of Trial Advocates, listed
in the Bar Registry of Preeminent Lawyers, and has been inducted into the
Outstanding Lawyers in America. Osborn has argued cases to the Washington
State Supreme Court and the Washington State Court of Appeals and serves on
the Board of Governors for Seattle University Law School. Osborn received his
law degree from University of Puget Sound in 1984.

    Contact:
    Mark Firmani
    Firmani + Associates
    206-443-9357
    mark@firmani.com