AMERICAN EAGLE OUTFITTERS DENIES RFID USE

FOR IMMEDIATE RELEASE
August 9, 2006

Crisis PR Firm Disavows Incriminating Video on Eve of Major Conference

On the eve of a major RFID apparel and footwear conference, privacy
activists are asking questions about an Orwellian industry video
presentation depicting the use of Radio Frequency Identification at an
American Eagle Outfitters store. The animated video, created by
technology integrator CompEx Inc., depicts how a retailer could embed
the controversial technology into clothing and credit cards to secretly
identify and track consumers–even deliver targeted marketing messages.

“American Eagle Outfitters has assured us that it is not using RFID in
its stores or operations, and we applaud them for that. But consumers
need to know that this technology exists and what it could mean for
them. We have documentation showing that other companies are looking
closely at these types of invasive applications,” said Liz McIntyre and
Katherine Albrecht, co-authors of “Spychips: How Major Corporations and
Government Plan to Track Your Every Move with RFID.”

The video shows a consumer walking into an American Eagle Outfitters
store, being remotely identified through the American Eagle Outfitters
credit card in his pocket, and purchasing items with RFID tags hidden in
the store’s branded clothing. The graphic footage concludes with a
full-facial biometric scan conducted through a pinhole camera at
checkout.

The animated flash clip is posted on the authors’ website at:
http://www.spychips.com/RFIDclothingstoredemo.html

Although the footage was created in 2002, its disclosure yesterday had
an immediate impact on senior management at American Eagle Outfitters.
McIntyre says that within minutes of sending the video clip to an
executive at American Eagle, she received a call from Ed Nebb, senior
director of investor relations and crisis communications at Berns
Communications Group. He issued the following statement:

“American Eagle currently does not use any RFID systems, either in
supply chain management, consumer credit card or loyalty programs, or
anywhere else within our operations. We highly value and respect our
customers’ privacy. The fact that a vendor may have offered a system
demonstration should not be interpreted as an intention on our part to
adopt such a system in the future.”

CompEx Inc. President Aram Kovach, who developed the video, told
McIntyre that American Eagle Outfitters had requested the RFID
demonstration. “They asked us to come out,” he said, explaining that the
executives later traveled to Kovach’s office in Ohio to see a working
prototype.

The RFID tracking capability depicted in the video is feasible. “It
worked,” Kovach said. “All of these things can be done.” But he noted
that the cost of the tags was a big barrier to adoption.

McIntyre and Albrecht worry that companies deterred by cost issues may
be reviving such plans now that the price of tags has dropped below the
$.08-cent range.

They point to the RFID Apparel and Footwear Conference to be held at New
York’s Fashion Institute of Technology next week as a reason for
concern. The event, co-sponsored by RFID Journal and the American
Apparel and Footwear Association, promises “to show you how RFID can
uniquely benefit the apparel and footwear industry.” However, unlike
past RFID events, where members of the press were welcomed, the
promotional literature for the conference states:

“The entire conference is off limits to the press, so you can be sure
you’ll get candid insider insight that you can’t hear anywhere else.”

“It’s clear that implementing RFID in apparel and footwear is being
discussed behind closed doors,” said Albrecht. “Our concern is that the
companies working to integrate RFID into clothing operations are keeping
their plans from the public. A case in point is Levi Strauss, which is
selling clothes with RFID hang tags attached, but refusing to disclose
the test location.”

The pair is asking the conference sponsors to explain the need for
secrecy at their event. “What is it they’re discussing that they don’t
want the press to know?” Albrecht asks. “The press restriction is
obviously not designed to keep proprietary information from industry
competitors, since any apparel or footwear company can attend the event
at a discounted rate. Clearly, excluding the press is an attempt to
prevent the public from learning about the industry’s plans to use RFID
tracking devices in clothing.”

Albrecht and McIntyre have posted a promotional email for the conference
that specifies the press restriction at:
http://www.spychips.com/RFIDApparelandFootwearConference.html

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ABOUT “SPYCHIPS”

Liz McIntyre and Katherine Albrecht are the authors of “Spychips: How
Major Corporations Plan to Track your Every Move with RFID.” The book
draws on patent documents, corporate source materials, conference
proceedings, and firsthand interviews to paint a convincing — and
frightening — picture of the consumer privacy threat posed by RFID.

Despite its hundreds of footnotes and academic-level accuracy, the book
remains lively and readable according to critics, who have called it a
“techno-thriller” and “a masterpiece of technocriticism.”

Two days prior to its release in 2005, “Spychips” flew the top of the
Amazon bestseller charts, hitting number one as a “Mover & Shaker,”
making its way to the top-ten Nonfiction bestseller list, and spending
weeks as a Current Events bestseller. In a nod to the book’s focus on
freedom, Spychips was awarded the prestigious Lysander Spooner Award for
Advancing the Literature of Liberty and named “the year’s best book on
liberty.”