This article contains content that is written like an advertisement. (June 2008) |
1-800 Contacts is a privately held company based in Draper, Utah that sells popular brands of contact lenses, including Johnson & Johnson Vision Care, CIBA Vision, Bausch & Lomb and CooperVision. The company's business model is fundamental to the product itself. Contact lenses are a highly fragmented category - over 5 million theoretical SKUs. Contact lenses come in small, light packages that are shipped through the mail and they require frequent replacement by the user. They seek to lower prices though warehousing a substantial inventory of contact lenses in one location and shipping them directly to consumers. Today, the company is the largest direct-to-consumer contact lens retailer and maintains the largest inventory of contact lenses.
| Company type | Privately Held |
|---|---|
| Industry | Contact Lens Retail |
| Founded | 1995 |
| Headquarters | Draper, Utah |
Key people | Jonathan C. Coon, CEO Brian Bethers, President Kevin McCallum, CMO Rob Hunter, CFO Joe Zeidner General Counsel |
| Products | Contact lenses |
| Revenue | $237,950,000[1] |
| $5,734,000[1] | |
| ($2,605,000)[1] | |
Number of employees | 680 (as of August 12, 2007)[1] |
| Parent | Fenway Partners |
| Website | www.1800contacts.com |
The company's last publicly reported net sales were in the 2006 fiscal year and were $247 million.[2]
Origin
1-800 Contacts was founded in 1995 by two entrepreneurs who sought to address contact lens wearers' problematic issues, with the mindset that contact lenses are expensive and inconvenient to replace. Their plan to accomplish this centered on buying contact lenses in bulk to get the lower prices while maintaining a large inventory.
Alliance with Wal-Mart
In January, 2008 1-800 Contacts entered a long-term agreement with Wal-Mart Stores Inc. to align their contact lens businesses.
Pop-up Ad lawsuit
1-800 contacts sued WhenU over pop-up advertisments.[3] In the suit against WhenU, which also named Vision Direct as a co-defendant,[4] 1-800 Contacts alleged that the advertisements provided by WhenU, which advertised competitors of 1-800 Contacts (such as Vision Direct) when people viewed the company's web site, as "inherently deceptive" and one that "misleads users into falsely believing the pop-up advertisements supplied by WhenU.com are in actuality advertisements authorized by and originating with the underlying Web site".[3]
In December 2003 Judge Deborah Batts of the United States District Court for the Southern District of New York granted a preliminary injunction, barring WhenU from delivering the advertisements to some web surfers, on the grounds that it constituted trademark infringement violating the Lanham Act.[5]
However, WhenU appealed, and the United States Court of Appeals for the Second Circuit held that WhenU's actions did not amount to the "use" that the Lanham Act requires in order to constitute trademark infringement. The appeal court reversed the preliminary injunction and ordered the dismissal of all claims made by 1-800 Contacts that were based upon trademark infringement, leaving the claims based upon unfair competition and copyright infringement.[6] The District court had already found that 1-800 Contacts was unlikely to prevail in its copyright infringement claims, finding that "the conduct neither violated [the] plaintiff's right to display its copyrighted website, nor its right to create derivative works therefrom".[7]
The Electronic Frontier Foundation criticised the case, stating that it was "not to help [people] fight off adware and spyware" but was rather intended to allow companies "to gain control over [a computer's] desktop", where the legal principles being employed "would create a precedent that would enable trademark owners to dictate what could be open on your desktop when you visit their websites". At the time of the appeal it filed an amicus curiae brief urging the Appeals Court to limit the reach of the "initial interest confusion" doctrine that had been applied by the District Court.[8]
References
- ^ a b c d 2005 10-K Report, accessed October 13, 2006
- ^ 1-800 CONTACTS. "company website".
{{cite web}}: CS1 maint: numeric names: authors list (link)| - ^ a b Christopher Saunders (2002-10-14). "U-Haul, 1-800 Contacts Join Anti-Pop-Up Bandwagon". ClickZ News. Incisive Interactive Marketing LLC.
{{cite news}}: Check date values in:|date=(help) - ^ 1-800 Contacts, Inc. v. WhenU.Com and Vision Direct, Inc. 309 F.Supp.2d 467 (S.D.N.Y., 2003-12-22), reversed in part and remanded, F.3d—2d. Cir., 2005-06-27
- ^ Stefanie Olsen (2004-01-05). "Pop-up seller loses round in court". CNET News.com.
{{cite news}}: Check date values in:|date=(help) - ^ Chloe Hecht (2005-09-25). "Court Sees Clearly Now: "Use" in 1 800-Contacts, Inc. v. WhenU.Com, Inc. and Vision Direct, Inc". Chilling Effects.
{{cite web}}: Check date values in:|date=(help) - ^ Martin H. Samson. "1-800 Contacts, Inc. v. WhenU.Com and Vision Direct, Inc". Phillips Nizer LLP Internet Library of Law and Court Decisions.
- ^ "1-800 Contacts v. WhenU". Electronic Frontier Foundation.