Tuesday, March 30, 1999

LensCrafters files contract suit

Ex-executives now competitors

The Cincinnati Enquirer

        LensCrafters has filed a lawsuit against two former employees and Minnesota-based United HealthCare Corp., alleging breach of contract, violation of a noncom pete agreement and release of trade secrets.

        The suit, filed in Hamilton County Common Pleas Court, revolves around EyeMed Vision Care, a managed-care program of Luxottica SpA, parent of LensCrafters. LensCrafters is a provider of the program, launched in U.S. test markets in late 1998.

        Defendants said the suit is without merit.

        According to the complaint, former executives Joel Ehrenpreis and David Sobkowiak, who helped develop EyeMed, misappropriated trade secrets when they founded a competing business soon after they left LensCrafters in spring

        1998. LensCrafters also claims that Mr. Ehrenpreis violated a 12-month noncompete clause when he co-founded the Cincinnati company, called Coordinated Vision Care Inc. (CVC).

        United HealthCare is involved because it became a major shareholder in CVC earlier this month, allegedly after meeting with LensCrafters about a potential strategic alliance. During these meetings, according to the lawsuit, LensCrafters said it shared confidential trade information with United. LensCrafters claims United used this information to make an investment decision about CVC, violating disclosure agreements.

        “We are shocked that Mr. Ehrenpreis chose to violate his noncompete agreement this way,” Kerry Bradley, executive vice president of LensCrafters, said in a statement.

        “We normally don't comment on litigation, but we trusted these two with a great deal of confidential company information.”

        LensCrafters seeks a temporary restraining order and an injunction to stop the use of LensCrafters trade secrets by CVC. LensCrafters also seeks monetary and punitive damages.

        Sources at Coordinated Vision Care and United HealthCare pledged to fight the complaint.

        “We are not going to comment on the specifics of this litigation. However ... we believe it has no merit and we will vigorously defend against it,” CVC said in a statement. “This lawsuit does not affect our ability to move forward with our business plan. It will not have an adverse impact on us. We remain committed to our mission of managing quality, value-added vision services to consumers/members.”

        A spokeswoman for United also said the company planned to defend against the suit “vigorously.”

        A hearing for the temporary restraining order is scheduled today.


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