Thursday, July 03, 2008
Judge's ruling is a relief for Sombra
By Andrew Webb
Journal Staff Writer
Three former employees of Albuquerque pain relief gel manufacturer Sombra Cosmetics misappropriated trade secrets when they attempted to set up a competing business in Los Lunas, a court has ruled.
District Court Judge Clay Campbell last month ordered Roberto Gomez, Michael Whalen and Tamara Richardson, of Alivia Laboratories, to cease making pain relief products using the same ingredients and production techniques as Sombra, and to stop distributing their product, Alivia.
The ruling concludes more than two years of legal wrangling between the 33-year-old Sombra and its upstart competitor, whose founders claimed in court documents they had invented Alivia using their own formulas, and claimed Sombra just wanted to push them out of competition.
Sombra Cosmetics makes a line of menthol and camphor-based analgesic gels and other products sold by health care professionals, such as chiropractors, under the product name Sombra, and by health food stores and other retailers under the name SoreNoMore.
It was founded in Albuquerque in 1975 by Alfredo Cortazar, a Mexican immigrant who had previously worked as a chemist for Max Factor and other well-known cosmetics businesses.
After struggling for a few years to make a go of various natural cosmetic products, Cortazar hit gold in the early 1990s when, at the suggestion of a chiropractor, he created an analgesic gel using camphor, menthol and other natural ingredients and, with the help of his then-wife, began marketing them to chiropractors.
“These formulations are challenging,” Sombra Chief Operating Officer Fredrick Osborne said. “He worked on them for years.”
Cortazar eventually moved Sombra from a tiny laboratory on McCleod NE to a 25,000-square-foot office and production facility on Office NE, and the company has since grown to be the No. 2 provider of pain relief gels to the chiropractic market, with distributors in 20 countries.
The SoreNoMore retail line was born of pressure from retailers like Wild Oats and Whole Foods, Cortazar said, and it is also supplied to sports teams and other professional users, including the University of New Mexico.
Cortazar said the company now mixes between 1,500 and 3,000 gallons of analgesic gel per week.
As he transitioned from hand-mixing the gels in 5-gallon buckets to much larger, automated equipment, Cortazar guarded the measurements of each ingredient, which by law are listed on the container, as well as the manufacturing techniques used to achieve the correct consistency and prevent ingredient separation, Osborne said.
“Eventually, he had to bring technicians on as the sales increased, but he still tried to keep it a secret,” Osborne said.
One of those technicians, according to court documents, was Gomez. Whalen was vice president for marketing from 2000 until late 2003, and Richardson was a customer service representative, according to court documents.
None had chemistry backgrounds, Sombra's lawyers alleged in court pleadings.
Sombra learned the former employees were making Alivia in a Los Lunas airport hangar about four years ago. According to court documents, Alivia's founders also mimicked Sombra's brochures and logos, and approached its customers.
A third-party analysis of Alivia confirmed it consisted of the same ingredients used in Sombra and SoreNoMore analgesic gels, according to court documents.
Though defense witnesses argued the formula could be easily gleaned from the list of ingredients on the $15 jar, Osborne says the correct percentages of key ingredients, such as capsaicin, a compound derived from peppers that causes a heating sensation on skin, could not have been reached by accident.
“The only way you could have known that would be to have worked here and mixed it,” he said.
Listed telephone and fax numbers for Alivia have been disconnected, and none of the defendants could be reached for comment.
Their attorney, Cody Kelley of Albuquerque, did not return calls seeking comment.
Osborne said the company would continue to pursue payment of damages, including $50,000 from each defendant in punitive and compensatory damages awarded by a jury.
But he called the permanent injunction the most important outcome.
“They were going to our same trade shows; it was very confusing to our customers,” Cortazar said. “At least we stopped that confusion.”