News Column

9th Circuit Rules That VSP Can Halt Business With Lawsuit Opponent

March 6, 2012

Dale Kasler

Vision Service Plan has been fighting for the right to stop doing business with an eyeglass manufacturer that's been suing VSP for a decade.

Last week, a federal appeals court sided with VSP.

The ruling by the 9th U.S. Circuit Court of Appeals was a victory for Rancho Cordova's VSP against Aspex Eyewear Inc. of Pembroke Park, Fla.

VSP is a $3 billion-a-year eye-care insurance company. It reimburses its 55 million subscribers for eye-care services, including purchases of glasses and contact lenses.

In August 2010, VSP cut ties with Aspex. That meant that customers who bought Aspex glasses would still be reimbursed by VSP, but at lower, out-of-network rates.

Aspex sued VSP in U.S. District Court in Sacramento, claiming the decision would crush it financially. It accused VSP of breach of contract and exercising unfair "market and monopoly power" in the eye-care business.

VSP disputed those arguments and said it had a valid reason for dumping Aspex: The Florida company wouldn't stop suing it.

The Rancho Cordova company owns two eyeglass manufacturing subsidiaries, both of which have been tangling in court with Aspex for years.

Aspex sued VSP's Altair subsidiary in 2002 and its Marchon subsidiary in 2009. In both cases, the Florida company said VSP's subsidiaries had infringed on patented designs for "magnetic clip-on eyewear."

The appeals court's ruling last week "was a vindication of our business model and our belief that we don't have to do business with a company that has sued VSP," said Thomas Fessler, VSP's chief legal officer.

Aspex also wound up losing the two patent-infringement lawsuits, although it's appealing those cases.

Lawyers for Aspex couldn't be reached for comment Monday.



Source: (c) 2012 The Sacramento Bee (Sacramento, Calif.)