L.A. Firm Sues AT&T;, Alleges Breach of Privacy

A Los Angeles-based company filed a $10-million federal suit against AT&T; on Friday because the phone giant allegedly shared confidential customer information with private investigators pretending to represent the Los Angeles company, in an incident raising questions about how easy it is to obtain information about others over the phone.

In its suit, Saybrex International, a food and beverage distributor, said two AT&T; customer-service representatives faxed Saybrex’s phone records to people who identified themselves as Saybrex employees but who actually worked for a firm called Touch Tone International. One of the AT&T; agents also spent 72 minutes reading details from a Saybrex bill to a Touch Tone caller, according to the suit.

An AT&T; spokesman said he could not comment on the suit because the company had not seen it yet.

The release of the phone records, which occurred in May 1996 and on later occasions, is reminiscent of GTE’s mistaken release of unlisted residential phone numbers to telemarketers. While that blunder compromised the personal privacy of some of its customers, AT&T;’s alleged actions in the Saybrex case allowed valuable information identifying its business partners in Asia to wind up in the hands of one of its competitors.

Saybrex lost several millions of dollars of business as a result, said Marshall Grossman, a partner with the Los Angeles law firm Alschuler Grossman & Pines, who is representing the company.

Saybrex learned that its records had been released when an AT&T; agent called Saybrex’s offices to confirm that the company had received one of its faxes.

Watchdogs at consumer groups in California said they had not heard of other cases in which a phone company shared customer information with unauthorized third parties. But they said the scenario is not hard to believe.

AT&T; spokesman Jim Byrnes said the company has “a stringent policy about protecting customer proprietary or private information,” but he declined to describe the customer verification procedures.

In the suit, Saybrex alleges one of its competitors, Burlingame-based International Beverage, hired a private investigator to gather information about Saybrex’s customers. The private investigator, in turn, hired Touch Tone, a company that advertises its “prowess at divulging the private telephone records of anyone” for $75, according to the suit.

Last year, Saybrex sued AT&T; in state court seeking an injunction to prevent the phone company from releasing its confidential records. While the court ruled that AT&T; had acted improperly, it did not grant the injunction because there was no evidence of continued wrongdoing, Grossman said. AT&T; also declined to comment on the state court case.

The federal lawsuit alleges violations of the Telecommunications Act and of the California Unfair Business Practices Act.

In addition to the $10 million in damages, Saybrex is seeking to “require AT&T; to adopt specific policies and procedures to inform its customers in writing before any information is released, and to embark on a major employee training program so that other Californians will not be victim to disclosures in the future either,” Grossman said.