View source for 1-800 Contacts

{{short description|American contact lens retailer}}
{{Infobox company
| name = 1-800 Contacts Inc.
| logo = 1800LogoWeb.png
| logo_caption = 
| type = [[Privately held company|Private]]
| foundation = {{start date and age|1995|2}}
| founders = [[Jonathan C. Coon]]<br>John F. Nichols
| location = [[Draper, Utah]], U.S.
| key_people = John Graham, [[Chief Executive Officer|CEO]]<br /> Phil Bienert, [[President (corporate title)|President]], [[Chief marketing officer|CMO]]<br /> Brett Gappmayer, [[CFO]]<br /> Douglas Harris, [[Chief operating officer|COO]] <br /> Amy Larson, President, New Business<br />  Roy Montclair, [[General Counsel]]
| industry = [[Contact lens]] retail
| products = Contact lenses
| revenue = $237 million (2005)<ref name="10K">[https://www.sec.gov/Archives/edgar/data/1050122/000110465906017311/a06-2743_110k.htm 2005 10-K Report], accessed October 13, 2006</ref>
| operating_income = $5.7 million (2005)<ref name="10K" />
| net_income = $2.6 million (2005)<ref name="10K" />
| num_employees = 
| owners = [[Kohlberg Kravis Roberts|KKR]]
| subsid = 
| homepage = {{URL|1800contacts.com}}
| footnotes = 
}}
[[File:1800contactsheadquarters.jpg|thumb|Former 1-800 Contacts headquarters in Draper]]
'''1-800 Contacts Inc.''' is an American contact lens retailer based in [[Draper, Utah]]. The brands that 1-800 Contacts sells include [[Johnson & Johnson]] Vision Care, [[Alcon]], [[Bausch & Lomb]] and [[CooperVision]]. The company was founded as the industry's first way to buy contacts online and has since expanded to provide online prescription renewals, glasses, lens replacements, and the in-house AquaSoft Daily contact lenses brand. In 2006, its last year as a public company, the company reported net sales of US$247 million.<ref name="1800contacts">{{cite web|url=http://www.1800contacts.com/ExternalRelations/TheCompanyHistory.aspx|title=company website|publisher=1-800 Contacts| accessdate= 12 August 2007 <!--Added by DASHBot-->| archiveurl= https://web.archive.org/web/20070818113942/http://www.1800contacts.com/ExternalRelations/TheCompanyHistory.aspx| archivedate= 18 August 2007 <!--Added by DASHBot-->}}</ref>

==History==
1-800 Contacts was founded in 1995 by [[Jonathan C. Coon]] and John F. Nichols, and was incorporated in February that year. The company held an IPO in 1998 on NASDAQ with the symbol CTAC with an offer price of $27.5M and share price of $12.50.<ref>{{cite news|title=1-800 Contacts CTAC IPO|publisher=NASDAQ|url=http://www.nasdaq.com/markets/ipos/company/1-800-contacts-inc-11704-4720| accessdate=23 March 2017}}</ref> They acquired [[Lens Express]] in 2002.<ref>{{cite news|title=1-800 Contacts to Acquire Lens Express and Lens 1st|publisher=Camelot Ventures Group|date=2002-12-16|url=http://www.camelotvg.com/news-02-contacts.html|accessdate=29 November 2011 |archive-url=https://web.archive.org/web/20111031131637/http://www.camelotvg.com/news-02-contacts.html|archive-date=2011-10-31|url-status=dead}}</ref>

Over the years, 1-800 Contacts has been owned by several companies. In June 2007, 1-800 Contacts was acquired by [[Fenway Partners]] for $24.25 per share.<ref>{{cite news| title=1-800 Contacts to be acquired by Fenway Partners for $24.25 per share | work=[[Reuters]] | url=https://www.reuters.com/article/idUSIN20070604090224CTAC20070604 | date=June 4, 2007}}</ref> In June 2012, 1-800 Contacts was sold to WellPoint (now [[Anthem (company)|Anthem]]).<ref>{{Cite web|url=https://dealbook.nytimes.com/2012/06/04/wellpoint-acquires-1-800-contacts/|archiveurl=https://web.archive.org/web/20150924171906/http://dealbook.nytimes.com/2012/06/04/wellpoint-acquires-1-800-contacts/|url-status=dead|title=WellPoint Acquires 1-800 Contacts|first=Evelyn M.|last=Rusli|date=June 4, 2012|archivedate=September 24, 2015|website=DealBook}}</ref>  In 2013 Wellpoint sold 1-800 Contacts to [[Thomas H. Lee Partners]] and glasses.com to [[Luxottica]].<ref>{{cite news| title=WellPoint Agrees to Sell 1-800-Contacts to Thomas H. Lee|publisher=bloomberg |url=https://www.bloomberg.com/news/articles/2014-01-07/wellpoint-agrees-to-sell-1-800-contacts-to-thomas-h-lee}}</ref> [[AEA Investors]] acquired a majority interest in 1-800 Contacts in December 2015.<ref>{{Cite web| title = AEA acquires majority interest in 1-800 CONTACTS| date=December 30, 2015 | url = http://www.healio.com/optometry/business-of-optometry/news/online/%7B177f9ef9-8d7b-4160-8917-a735b20c0cfb%7D/aea-acquires-majority-interest-in-1-800-contacts}}</ref>

In 2008, 1-800 Contacts entered into a partnership with [[Walmart]] to integrate phone and Internet orders for contact lenses with eye-doctor services and operations in Walmart's stores,<ref>{{Cite web|url=https://www.deseret.com/2008/1/18/20065060/1-800-contacts-wal-mart-announce-a-long-term-pact/|archive-url=https://web.archive.org/web/20161009014412/http://www.deseretnews.com/article/695245012/1-800-CONTACTS-Wal-Mart-announce-a-long-term-pact.html?pg=all%2F|url-status=live|title=1-800-Contacts, Wal-Mart announce a long-term pact|date=January 18, 2008|archive-date=October 9, 2016|website=DeseretNews.com}}</ref> The agreement ended in 2013. In June 2013, 1-800 Contacts launched glasses.com, a domain which the company has held since 1999.<ref>{{cite news|title=Glasses.com releases 3D Fit Technology|url=https://www.1800contacts.com/connect/press-releases/glasses-com-releases-3dfit-technology-change-way-people-buy-glasses|access-date=2017-03-23|archive-url=https://web.archive.org/web/20180128074718/https://www.1800contacts.com/connect/press-releases/glasses-com-releases-3dfit-technology-change-way-people-buy-glasses|archive-date=2018-01-28|url-status=dead}}</ref>

== Acquisitions ==

=== Liingo ===
In 2017, 1-800 Contacts acquired Liingo, which is an eyewear brand.<ref>{{Cite web |title=Liingo Eyewear Acquired by 1-800 Contacts |url=https://www.prnewswire.com/news-releases/liingo-eyewear-acquired-by-1-800-contacts-300590527.html |access-date=2022-07-19 |website=www.prnewswire.com |language=en}}</ref> Liingo Eyewear was founded in October 2016, in [[Draper, Utah|Draper]], Utah.

=== 6over6 ===
In 2019, 1-800 Contacts acquired 6over6, which is a digital healthcare technology that enables consumers to perform their own vision tests from anywhere using a computer or smartphone.<ref>{{Cite web |title=1-800 Contacts acquires revolutionary tech company 6over6 Vision |url=https://www.1800contacts.com/eyesociety/1-800-contacts-acquires-revolutionary-tech-company-6over6-vision |date=2020-02-12 |access-date=2022-07-19 |website=www.1800contacts.com}}</ref> 

=== Ditto ===
In 2021, 1-800 Contacts acquired Ditto.<ref>{{Cite web |title=Updated: 1-800 Contacts Acquires Ditto |url=http://mobile.visionmonday.com/business/article/1800-contacts-acquires-ditto/ |access-date=2022-07-19 |website=mobile.visionmonday.com |language=en}}</ref> Ditto's technology allows shoppers to realistically try-on eyewear and receive frame recommendations.

==Lawsuits==

=== WhenU lawsuit ===
{{main|1-800 Contacts, Inc. v. WhenU.com, Inc.}}
1-800 Contacts sued [[WhenU]] over [[pop-up ad]]vertisements in 2002.<ref name="ClickZ">{{cite news|title=U-Haul, 1-800 Contacts Join Anti-Pop-Up Bandwagon|work=ClickZ News|author=Christopher Saunders|date=2002-10-14|url=http://www.clickz.com/showPage.html?page=1481481|publisher=Incisive Interactive Marketing LLC| accessdate= 12 October 2006 <!--Added by DASHBot-->| archiveurl= https://web.archive.org/web/20061013013656/http://www.clickz.com/showPage.html?page=1481481| archivedate= 13 October 2006 <!--Added by DASHBot-->}}</ref> In the suit against WhenU, which also named Vision Direct as a co-defendant,<ref>''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</ref> 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".<ref name="ClickZ" />

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]].<ref>{{cite news|title=Pop-up seller loses round in court |author=Stefanie Olsen |work=CNET News.com |date=2004-01-05 |url=http://news.cnet.com/Pop-up+seller+loses+round+in+court/2100-1024_3-5135313.html |accessdate=12 October 2006 |archiveurl=https://web.archive.org/web/20140714163629/http://news.cnet.com/Pop-up%2Bseller%2Bloses%2Bround%2Bin%2Bcourt/2100-1024_3-5135313.html |archivedate=14 July 2014 |url-status=dead }}</ref> 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 appeals 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]].<ref>{{cite web|url=http://www.chillingeffects.org/weather.cgi?WeatherID=519|archive-url=https://archive.today/20060924215719/http://www.chillingeffects.org/weather.cgi?WeatherID=519|url-status=dead|archive-date=2006-09-24|work=Chilling Effects|title=Court Sees Clearly Now: "Use" in 1 800-Contacts, Inc. v. WhenU.Com, Inc. and Vision Direct, Inc.|author=Chloe Hecht|date=2005-09-25| accessdate= 12 October 2006 }}</ref>  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".<ref>{{cite web|url=http://www.phillipsnizer.com/library/cases/lib_case335.cfm|title=1-800 Contacts, Inc. v. WhenU.Com and Vision Direct, Inc.|author=Martin H. Samson|work=Phillips Nizer LLP Internet Library of Law and Court Decisions|accessdate=12 October 2006 |archive-url=http://webarchive.loc.gov/all/20040427214742/http://www.phillipsnizer.com/library/cases/lib_case335.cfm|archive-date=2004-04-27|url-status=dead}}</ref>

The [[Electronic Frontier Foundation]] criticized 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 environment|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.<ref>{{cite web|url=https://www.eff.org/legal/cases/1800contacts_v_whenu/|title=1-800 Contacts v. WhenU|publisher=[[Electronic Frontier Foundation]]| accessdate= 12 October 2006 <!--Added by DASHBot-->| archiveurl= https://web.archive.org/web/20061014165110/http://www.eff.org/legal/cases/1800contacts_v_whenu/| archivedate= 14 October 2006 <!--Added by DASHBot-->}}</ref>

In addition to the WhenU case, 1-800 Contacts has been involved in other trademark infringement suits revolving around the issue of keyword advertising. On March 8, 2010, 1-800 Contacts sued Contact Lens King, Inc. Ezcontacts.com for trademark infringement based on their use of "1-800 CONTACTS" trademarks as keywords to trigger sponsored ads directing consumers to Contact Lens King's website and products.<ref>{{cite web|url=https://contactlenses.knoji.com/compare/1800contacts-vs-contactlensking/|website=Inside Trademarks|url-status=dead|accessdate=2010-03-14|title=1-800 Contacts, Inc. v. Contact Lens King, Inc.|archive-url=https://web.archive.org/web/20191219050454/https://contactlenses.knoji.com/compare/1800contacts-vs-contactlensking/|archive-date=2019-12-19}}</ref>

=== Lens.com lawsuit ===
1-800 Contacts was also involved in several lawsuits against Lens.com, Inc., including a trademark cancellation case in the United States Court of Appeals for the Federal Circuit, [[Lens.com, Inc. v. 1-800 Contacts, Inc.]], in which the Court determined that Lens.com's trademark "''LENS''", held in connection with "computer software", had been abandoned because Lens.com merely used software to sell contact lenses over the internet, while consumers had no association between the trademark and computer software.

In 2013, the Tenth Circuit Court of Appeals held that Lens.com did not commit [[trademark infringement]] when it purchased search advertisements using 1-800 Contacts' federally registered 1800 CONTACTS trademark as a keyword. In August 2016, the [[Federal Trade Commission]] filed an administrative complaint against 1-800 Contacts alleging, among other things, that its search advertising trademark enforcement practices have unreasonably restrained competition in violation of the FTC Act. 1-800 Contacts has denied all wrongdoing.<ref>David O. Klein & Joshua R. Wueller, ''Trademark Enforcement and Internet Search Advertising: A Regulatory Risk for Brand Owners'', IP Litigator, Nov./Dec. 2016. {{SSRN|2897528}}</ref> On June 11, 2021, the Second Circuit vacated the FTC's request.<ref>{{Cite web|date=2016-08-08|title=1-800 Contacts, Inc, In the Matter of|url=https://www.ftc.gov/enforcement/cases-proceedings/141-0200/1-800-contacts-inc-matter|access-date=2023-12-21|website=Federal Trade Commission|language=en}}</ref><ref>{{Cite web|date=2021-06-15|url=https://www.shearman.com/en/perspectives/2021/06/second-circuit-holds-that-1-800-contacts-lawfully-protected-its-trademark-in-online-search-auctions|access-date=2023-12-21|website=Shearman & Sterling|title=Second Circuit Holds That 1-800 Contacts Lawfully Protected Its Trademark In Online Search Auctions}}</ref>

=== DITTO and FTC lawsuits ===
On April 17, 2013, the [[Electronic Frontier Foundation]] claimed that 1-800 Contacts abused patent law by acting like a [[patent troll]] in its lawsuit against [[DITTO]]. In a blog post, the EFF accused 1-800 Contacts of "leveraging the massive expense of patent litigation to squelch the competition"<ref>{{cite web | url=https://www.eff.org/deeplinks/2013/04/1-800-contacts-buys-patent-squelch-competition | title=Updated: Help Stop 1-800-Contacts from Abusing Patents to Squelch Competition | publisher=Electronic Frontier Foundation | date=2013-04-22 | accessdate=2013-05-23 | last1=Nazer | first1=Daniel | last2=Samuels | first2=Julie}}</ref> and asked its followers to help DITTO by [[crowdsourcing]] prior art.

On August 8, 2016, the Federal Trade Commission filed an administrative complaint charging that 1-800 Contacts, the largest online retailer of contact lenses in the United States, unlawfully orchestrated a web of anti-competitive agreements with rival online contact lens sellers that suppress competition in certain online search advertising auctions and that restrict truthful and non-misleading internet advertising to consumers.

According to the administrative complaint, 1-800 Contacts entered into bidding agreements with at least 14 competing online contact lens retailers that eliminate competition in auctions to place advertisements on the search results page generated by online search engines such as [[Google]] and [[Bing (search engine)|Bing]]. The complaint alleges that these bidding agreements unreasonably restrain price competition in internet search auctions, and restrict truthful and non-misleading advertising to consumers, constituting an unfair method of competition in violation of federal law.

In an initial decision entered on October 27, 2017, and announced on October 30, 2017, Chief Administrative Law Judge D. Michael Chappell upheld a Federal Trade Commission complaint against 1-800 Contacts, ruling that the FTC has proved that the nation's largest online retailer of contact lenses unlawfully orchestrated a web of anti-competitive agreements with rival online contact lens sellers.<ref>{{Cite web|url=https://www.ftc.gov/system/files/documents/cases/docket_9372_1-800_contacts_inc._initial_decision_final_redacted_public_version.pdf|title=Initial Decision by ALJ D. Michael Chappell|last=|first=|date=|website=|access-date=}}</ref>

An order Judge Chappell included with the initial decision would bar 1-800 Contacts from agreeing with a marketer or seller of any contact lens product to restrict, prohibit, regulate or otherwise limit that seller's participation in search advertising auctions, and would also bar 1-800 Contacts from instructing search engines to restrict or prohibit any seller's use of any keyword (a word or phrase used to instruct a search engine to display specified search advertising), or to require any seller to use any negative keyword (a word or phrase used to instruct a search engine not to display specified search advertising).<ref>{{Cite web|url=https://www.ftc.gov/system/files/documents/cases/docket_9372_1-800_contacts_inc._initial_decision_final_redacted_public_version.pdf|title=Id. at 203|last=|first=|date=|website=|access-date=}}</ref>

Also under the order, 1-800 Contacts would be barred from agreeing with a seller to restrict, prohibit, regulate or otherwise limit that seller's use of truthful, non-deceptive, and non-trademark-infringing advertising or promotion. The order would also require the company to stop enforcing or attempting to enforce any and all provisions, terms, or requirements in any existing agreement or court order that impose a condition on a seller that would be inconsistent with the order.<ref>{{Cite web|url=https://www.ftc.gov/system/files/documents/cases/docket_9372_1-800_contacts_inc._initial_decision_final_redacted_public_version.pdf|title=Id. at 204|last=|first=|date=|website=|access-date=}}</ref>

==References==
{{Reflist|30em}}

==External links==
*[http://secfilings.nasdaq.com/edgar_conv_html%2f2005%2f03%2f17%2f0001047469-05-006925.html#FIS_BUSINESS SEC Filing on NASDAQ]

[[Category:1995 establishments in Utah]]
[[Category:Companies based in Utah]]
[[Category:American companies established in 1995]]
[[Category:Retail companies established in 1995]]
[[Category:Telephone numbers in the United States|800-Contacts]]
[[Category:Contact lenses]]
[[Category:Eyewear companies of the United States]]
[[Category:Eyewear retailers of the United States]]
[[Category:2007 mergers and acquisitions]]
[[Category:2012 mergers and acquisitions]]
[[Category:2013 mergers and acquisitions]]
[[Category:2015 mergers and acquisitions]]