Breast form makers fire salvos

Wednesday, March 31, 2004

MARIETTA, Ga. - Coloplast, the leading manufacturer of breast forms in the U.S. market, and rival upstart American Breast Care (ABC) are wrangling over trade secrets, non-compete agreements and accusations of monopolization as the two companies try to settle the dust stirred up when Coloplast moved its Amoena breast form manufacturing to Germany last year.

In December, an arbiter ruled that Lou Malice, the one-time president of Amoena, violated the terms of his two-year non-compete agreement by taking the helm as co-CEO of ABC. Malice has continued to work at ABC but in another position.

In the wake of that arbiter’s decision, Coloplast added Jolly Rechenberg, who founded Amoena and sold it to Coloplast in 1994, to legal proceedings it launched against seven other ex-Amoena employees who’d moved to ABC.

After Coloplast filed its lawsuits against its former employees for violations of trade secrets last summer, ABC filed its own suit against Coloplast, arguing that the breast form manufacturer was attempting to monopolize the U.S. breast form market in violation of the Sherman Anti-Trust Act.

ABC believes that Amoena now enjoys a 60% share of the American breast form market. Amoena doesn’t believe its share is that large. Medicare pays about $40 million for breast forms yearly and serves as payer for about two-thirds of the breast form market in the United States.