Gillette's Lawsuit Against Razor Startup ShaveLogic Dismissed

By Sharon Terlep Features Dow Jones Newswires

Gillette's lawsuit against a rival razor maker has backfired.

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A Massachusetts Superior Court justice this week dismissed a lawsuit by the Procter & Gamble Co. unit that accused four former employees of taking company information to the startup ShaveLogic Inc., while allowing a countersuit by the former workers and the startup to move forward.

In his decision, Justice Kenneth Salinger said Gillette failed to prove that ShaveLogic used any confidential information to develop its razors.

"A reasonable fact finder could conclude that Gillette had deliberately brought baseless claims in an attempt to bully ShaveLogic out of the market," Justice Salinger wrote.

ShaveLogic Chief Executive Rob Wilson said the company, which is currently not selling razors, is now able to move forward. "We have always contended Gillette's claims were without merit and we did nothing wrong." A P&G spokeswoman said the company was disappointed in the ruling and is considering "a range of legal options."

"The defendants literally walked away with confidential documents and prototypes which were returned to Gillette only because of this litigation," she said in a statement. "We also believe they used the collective work of our R&D team to help a competitor."

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The case is one of several Gillette has brought against rival razor companies as the brand cedes market share to upstarts offering cheaper blades and online delivery.

P&G is suing Dollar Shave Club, an online subscription service now owned by Unilever PLC, alleging patent infringement. Last year, it also sued Edgewell Personal Care Co., maker of Schick brand razors and Edge shave gels, accusing it too of patent infringement and making misleading claims about it. P&G and Edgewell later settled for undisclosed terms. Both Edgewell and Dollar Shave Club have denied P&G's allegations.

In the ShaveLogic suit, brought in 2015, Gillette accused the former employees of using trade secrets at Dallas-based ShaveLogic. ShaveLogic, in its countersuit, said Gillette's lawsuit scared off both a potential distributor and a possible acquirer that the company was in talks with at the time.

"It is pretty rare to see a judge be so direct in indicating that he thinks the lawsuit was more anticompetitive than meritorious," said Jim McDonough, an Atlanta-based intellectual property attorney. Mr. McDonough said startups rarely have the financial resources to successfully pursue counterclaims against suits brought by large companies.

According to ShaveLogic's website, the startup "has developed a full line of razors that provide true performance skincare at a price that doesn't break the bank."

Write to Sharon Terlep at sharon.terlep@wsj.com

(END) Dow Jones Newswires

April 21, 2017 15:57 ET (19:57 GMT)