🚨Scholly Founder Sues Sallie Mae Over Data Privacy
Sallie Mae faces lawsuit over user data sales after acquiring Scholly
TL;DR
Scholly founder, who sold his scholarship search app to Sallie Mae in July 2023, is now suing the company for wrongful termination and data selling without proper user notification. The lawsuit alleges that Scholly's personal user data was sold to third parties despite promises of privacy.
Scholly founder Chris Grayson has filed a lawsuit against Sallie Mae, alleging wrongful termination and data selling practices after his app was acquired in July 2023. He claims he was fired when raising concerns about data privacy issues, with Scholly's user data being sold to third parties like universities and advertisers despite promises of protection. The platform had over 5 million users and generated $30M in cumulative revenue before the acquisition. This case highlights the risks of selling out for scale versus maintaining user trust.
Key Points
Scholly was acquired by Sallie Mae in July 2023 for an undisclosed amount, growing the platform from 5 million users with $30M revenue
Founder Chris Grayson took a VP role at Sallie Mae but was fired after raising data privacy concerns
Grayson alleges Sallie Mae laid off Scholly employees and went back on promises not to sell user data
Sallie.com discloses selling customer data, including personal info like age, race, gender, education records, and geolocation
The lawsuit seeks backpay, punitive damages, and legal costs from Sallie Mae for alleged wrongful termination and data misuse
Why It Matters
If you're a startup founder considering selling your company to a larger entity, this case highlights the risks of losing control over user data privacy. Grayson's experience shows that even with promises of protection, post-acquisition practices can lead to significant legal and reputational damage.
Frequently Asked Questions
Why does this matter?
If you're a startup founder considering selling your company to a larger entity, this case highlights the risks of losing control over user data privacy. Grayson's experience shows that even with promises of protection, post-acquisition practices can lead to significant legal and reputational damage.
What happened?
Scholly founder, who sold his scholarship search app to Sallie Mae in July 2023, is now suing the company for wrongful termination and data selling without proper user notification. The lawsuit alleges that Scholly's personal user data was sold to third parties despite promises of privacy.
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