This is what Mary Kay Inc. sent out to the national sales directors in April 2007 about losing the Tristrata patent lawsuit. I love the company's justification of its actions and denial of wrongdoing. "We didn't do it. Honest!!!!"

As you may recall, Mary Kay Inc. was one of many cosmetics companies sued in 2001 by Tristrata Technology, Inc., which claimed that Mary Kay used patented technology owned by Tristrata relating to the use of Alpha Hydroxy Acids (AHAs) in certain Mary Kay® products beginning in the early 1990s. We began phase-out of products containing AHAs long before the litigation was filed, and we have not produced products containing AHAs for many years.

 

In March 2005, a Delaware court returned a verdict in favor of Tristrata. More than a year following the jury verdict, the court entered a judgment in the case against Mary Kay. Though we appealed the verdict, the decision of the lower court in favor of Tristrata was recently upheld.

 

We are, of course, disappointed by this outcome. We strongly maintain that we did not infringe Tristrata'€™s patents, as we developed our own patented AHA technology in a collaborative process between Mary Kay's own laboratories and an outside scientist not affiliated with Tristrata. However, the jury did not agree with our position, so Mary Kay will comply with the court'€s ruling. The amount of money involved will not affect the Mary Kay® product line or our service to our independent sales force in any way. The Company has prepared for this scenario and has taken appropriate action to be in a position to comply with the court'€™s decision.

 

You should know that it is not unusual for a company our size on occasion to be involved in patent litigation. Rest assured, however, that we will continue to provide innovative products for you while always respecting the intellectual property rights of others. That is what we did in this case and that is what we will continue to do.

 

While we have not seen any media attention on this decision other than a few initial reports, we are providing this information to prepare you in case you need to verbally respond to any questions you may receive. Certainly you should feel free to defer any questions to us, and if you personally have any questions regarding this matter, do not hesitate to contact Legal Support .