Mattress Firm’s CEO denies taking Tuft and Needles confidential information under false pretenses. In a motion filed to a Texas judge earlier this week, Tuft and Needle accused Mattress Firm of taking its sensitive data.
In a statement emailed to The Phoenix Business Journal, Mattress Firm President and CEO Ken Murphy said his company never received confidential information or data from Tuft & Needle and did not offer to acquire any ownership of the Phoenix-based bed-in-a-box company.
In documents filed in the U.S District Court for the Southern District of Texas Monday, Tuft and Needle claimed that in the summer of 2017, Houston-based Mattress Firm pursued a potential business relationship with Tuft & Needle.
“After obtaining (Tuft & Needle’s) confidential business information and data, which (Mattress Firm) now euphemistically calls ‘competitive intelligence,’ it called off discussions and now attempts to eliminate a small competitor through the expense of this lawsuit, rather than a business transaction,” Tuft & Needle said.
“We will address these latest false statements, along with their other misleading assertions and publicity efforts, in our lawsuit,” Murphy said.
On Monday, Tuft and Needle asked a Houston judge to dismiss a false advertising and defamation lawsuit Mattress Firm filed in October.
Mattress Firm’s lawsuit alleges Tuft & Needle “orchestrat(ed) a multi-state smear campaign against ‘greedy’ mattress stores” and “accus(ed) Mattress Firm of perpetuating a ‘scam’ on consumers based on ‘gimmicky’ marketing, ‘unfair’ markups, ‘death spiral’ return policies, and ‘snake oil.’”
The Oct. 16 lawsuit also illustrates at least one example where a Tuft & Needle advertisement featured the words “Mattress Goliath” using “the same color scheme, font, and layout” as Mattress Firm’s trademark.
“We filed this suit to seek redress for Tuft & Needle’s own willful acts of unfair competition, false and disparaging advertising, and improper use of our brand, and will vigorously defend its integrity,” Murphy wrote in his statement.
On Tuesday, Tuft and Needle’s attorney Charles “Chip” Babcock said he is investigating if Mattress Firm qualifies as a monopoly and Tuft and Needle could possible file a countersuit against Mattress Firm or its parent company Steinhoff International Holdings (STNHV).
“Mattress Firm welcomes competition, but not at the expense of honesty and integrity,” Murphy said.