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Dick's undercover rival, a Modell's top executive, spurs lawsuit

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Saturday, March 1, 2014, 12:01 a.m.
 

Dick's Sporting Goods has accused the top executive of competitor Modell's Sporting Goods of taking his experience on the TV show “Undercover Boss” too far.

Mitchell Modell visited a Dick's store in Princeton, N.J., in January and pretended to be a Dick's senior vice president to obtain confidential information about its online sales and marketing, Dick's alleged in a lawsuit.

The lawsuit, which was filed Feb. 20 in Mercer County Court in New Jersey, said Modell claimed he was to meet Edward Stack, CEO of Findlay-based Dick's, at the store. He persuaded employees to show him the backroom of the store and answer questions about the business, the lawsuit alleged.

Modell, who put on an oversized mustache and shaved his head to pose as a low-level employee of his company for a 2012 episode of the CBS show “Undercover Boss,” gathered information about Dick's online sales, including a “ship from store” program that gets products to customers quickly, the lawsuit said.

Modell's spokesman Jason Karlowski declined to comment.

In a statement, Dick's officials said the company “takes seriously the protection of its confidential and proprietary information,” but declined to comment on the lawsuit.

“That takes a lot of nerve,” Jeff Inman, a professor of marketing and retailing expert at the University of Pittsburgh's Katz Graduate School of Business, said of Modell's alleged subterfuge.

It's common for retailers to send employees into rival stores to compare prices, Inman said. But he never heard of an executive posing as an employee of a competitor to gain inside knowledge.

“This is highly unusual,” he said.

Dick's accused its rival of civil conspiracy and trespass and is seeking attorneys' fees and a judge's order to prevent Modell and his workers from entering nonpublic areas of Dick's stores or posing as employees.

Following his experience with “Undercover Boss,” Modell said, he learned how physically demanding warehouse work was and made changes in staffing and workload throughout his company. Modell's has 153 stores in 10 Northeast and Mid-Atlantic states.

Dick's, a publicly traded company with more than 550 stores in 46 states, is expanding its e-commerce capabilities and has said it will achieve online sales of $1.1 billion by early 2018, up from $292 million in 2012.

In its most recent quarter, Dick's said it boosted sales through its website by offering free shipping.

The Associated Press contributed to this story. Alex Nixon is a staff writer for Trib Total Media.

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