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Italiano "Cosa Nostra" – Switzerland acts
Yesmokes on-line sales will be slightly delayed.
Everything was ready to go at Yesmoke, to start cigarette sales on-line scheduled for October 30th. The new entirely robotized Logistics was waiting to put out cartons of 100 Yesmoke cigarettes, each containing 10 packs of 10 cigarettes, that will be sold at $ 5.95, with free delivery.
Yesmoke's "Shop", that talks of consumer rights, of correct taxation of mail order products, was ready to go online the same day, and a merchant* contract for credit card payments had been signed many months before with the Swiss company Aduno SA**, leader in the sector.
But suddenly, here comes the surprise. Aduno pulls back from its agreement.
It would seem that the Swiss "Cosa Nostra" did not give its approval to work with Yesmoke.
How would you feel if you bought a house, paying according to agreements and signing a regular contract before a notary. And then, out of the blue, the seller changes his mind, gives back your money, tears up the contract and throws you out into the street.
This is what Aduno has done to Yesmoke in Switzerland. It is a desperate and pathetic move, that of Aduno, without any hope before the law. Aduno's only purpose is to demonstrate, before probable and efficacious pressures imposed by someone, its “good will”.
The facts
March 2007: Yesmoke turns to Aduno SA to have online payment services with credit cards. Aduno asks for some time to examine Yesmoke's activities.
11 May 2007: Aduno signs the Contract with Yesmoke.
25 May: Aduno, unexpectedly, draws back with a puerile excuse: "In light of a recent redefinition of our company's ethical code, it has been decided that tobacco does not fall into the product category which Aduno intends to work with… therefore, we find ourselves obliged to cancel, with immediate effect, the contract stipulated on 11 May 2007. ” What could have happened at Aduno in the period between the 11th and the 25th of May?
5 June: Yesmoke's lawyers answer Aduno: " Legally it is irrelevant that you refer “ex post” to a supposed “internal policy”, to attempt to withdraw from the binding nature of a contract which you have signed”.
6 July: Aduno makes itself heard with a new excuse, more ridiculous than the first: "We are reconfirming our cancellation. In fact, the contract was signed, on behalf of Aduno SA., by two collaborators who were not authorized to sign for this business”.
11 July: Yesmoke's lawyers reply: "We find your pretext absolutely unjustifiable and legally irrelevant, you want to disclaim your collaborators' power to represent you, collaborators obviously appointed to do this”.
30 July: Aduno does not give up: "The commercial activity of your client, from what we have learned, has in the past run into some problems from a legal point of view”.
12 September: Yesmoke's lawyers reply: "Answering the pretext you mentioned, there can be no doubts regarding the legitimacy of the commercial activities of my client, that has every right to sell, under its own trademark “Yesmoke”, by Internet, products derived from tobacco”.
17 October, after repeated requests, Aduno responds with another novelty: it refers to a supposed Visa and MasterCard regulation that requires a written opinion from an independent, reputable, and qualified legal counsel, stating that the merchant's activity complies fully with the law.
22 October, Yesmoke's lawyer counters asking for a copy of the “regulations”.
The next moves
There are dozens of on-line shops today selling all brands of cigarettes, including Philip Morris's products, purchased on the parallel market. They, in fact, are operating in open contrast with all the various sentences favourable to Big Tobacco related to the sale on-line of Philip Morris products.
All of these, along with on-line pornography sites, on-line casinos, and illegitimate pharmacies, are qualified to receive payments through Visa and MasterCard credit cards. So, why should Yesmoke, that intends to market only its own products, be the only exception to these “regulations”.
But Yesmoke has always had “special” treatment, and very probably, legal procedures will be the only way to oblige Aduno to respect the contract and pay the damages caused.
Yesmoke has a number of alternatives available, starting from Italian banks. Unfortunately for them, and with our regrets, Switzerland is decidedly more competitive for the online merchant service.
Swiss paradoxes
Yesmoke has already pointed out some of the extreme and paradoxical situations of the Swiss Market, where a company would expect to find stability and security.
In the fortress of tobacco multinationals, it might happen that collaboration is refused by some banks with “sober” explanations, like: “Sorry, but you sell tobacco, a product that is harmful for the health…”
Handing over documents to anyone, without the owner's authorization, is a crime of unparalleled gravity for Swiss Law: "Violation of fiduciary mandate". But beware! Switzerland 's privacy protection laws are not an obstacle for Big Tobacco.
For example, the fiduciary office that handled the financial affairs of Yesmoke (at that time a Swiss Company), back in 2003, during the legal battle with Philip Morris, without letting its Client know, allowed all Yesmoke's confidential documents to get into the hands of Philip Morris, and the tobacco giant then produced all this documentation at the trial in New York.
Big Tobacco even knew the exact amount of the telephone bills, the sums paid for furniture, travel expenses, revenue, taxes paid, etc. (The file did not include Yesmoke's customer lists, that is not released to a Fiduciary Studio.)
The behavior of the Aduno, the clever “picciotto” (lower rank Mafioso) is incredible and but also ridiculous. But in Switzerland, when you touch the interests of the “Bosses”, anything is possible.
* A merchant account allows a business to accept credit cards, debit cards, gift cards and other forms of payment cards. Merchants who receive credit card payment for their goods or services, must apply for a merchant account typically through a merchant account provider, or acquirer.
** Aduno SA is one of the principal merchant account providers in Switzerland. It belongs to the Aduno Group, which unites under the same roof the issuing activities of the Issuer Viseca Card Services SA and the acquiring activities of Aduno SA. The objective of the Aduno Group is to become number One in Switzerland for payment operations without cash.
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