Estee Lauder Sued for Breach of Contract and Fraud

11/28/2007

New York-based Nefeli Corporation, a company specializing in applying Traditional Chinese Medicine concepts to skincare, has filed a $5 million dollar lawsuit against Estee Lauder Inc. and its affiliate Origins Natural Resources Inc. for breach of contract and fraud. According to the suit filed in the Supreme Court of the State of New York in July 2007, Estee Lauder contacted Nefeli Founder Dr. Ping Zhang with an interest in incorporating Traditional Chinese Medicine concepts into its products and entering into a future business relationship. Dr. Zhang alleges that once Estee Lauder and Origins received Nefeli's product samples and confidential information on the application of Traditional Chinese Medicine to skincare, Estee Lauder breached the contract by illegally analyzing and reverse engineering the product samples. According to Dr. Zhang, Lauder's and Origins' representatives verbally notified Nefeli that it was no longer needed because Lauder and Origins claimed they would be able to produce their line of products without Dr. Zhang's help. At press time, a statement from Estee Lauder on the lawsuit had not yet been released.