CyberRebate

Cyberrebate.com, Inc. was an online retailer founded in May 1998 that went bankrupt in May 2001, after the collapse of the dot-com bubble.

The company sold items at grossly inflated prices, as much as 10 times the list price, but promised customers a 100% rebate.^[1][2][3]

The company relied on the assumption that 50% of its customers would neglect to apply for their rebate.^[4][5]

History

Joel Granik, Joseph Lichter and Athan Vadiakas started the website on May 16, 1998. By November 2000, the company claimed to have rebated $39 million to its customers.^[6]

In January 2001, it was the third–ranked online retailer in the United States and had 7.7 million web users per month.^[4][7]

The company filed for bankruptcy protection under Chapter 11, Title 11, United States Code on 16 May 2001, citing $83.3 million in liabilities and $24.5 million in assets.^[7] Approximately $80 million was due directly to customers in unpaid rebates.^[4] At the time of the bankruptcy filing, there were 9 customers that were due pending rebates of $79,000-$100,000 each.^[8]

In April 2005, some creditors were awarded $0.08802 per dollar of allowed claims. A second, final disbursement was made to creditors in August 2006 for $0.0006276 per dollar of allowed claims, or roughly $1 for every $1,600 claimed.