Estee Lauder is being sued by a small tech startup, which has claimed the global cosmetics giant stole its ideas and effectively pushed it out of business.
The lawsuit, filed in federal court in New York, comes from a company called Nomi Beauty, which says it developed technology to help beauty brands understand what customers actually want to buy – especially travellers staying in hotels.
Nomi, pronounced “know me,” says it created tools it described as its “secret sauce,” which were designed to help Estée Lauder sell more products in luxury hotels, duty‑free shops, and in‑room services, reducing the company’s reliance on traditional stores.
However, according to the lawsuit, Estee Lauder, the parent company of brands including Clinique and MAC lipstick, then ended its contracts with Nomi in 2018 and 2020, and used the startup’s ideas to launch its own new sales programs in several countries, including China, Costa Rica, Malaysia, the U.K. and the U.S.
In the lawsuit, the startup said these new programs were built on the same confidential information it had shared with Estee Lauder during their partnership.
It also claims the cosmetics giant cut off supplies to hotels working with Nomi, making it impossible for the smaller company to operate.
The filing argues that Estee Lauder has earned significant new revenue from technology developed by the startup, and that this behaviour effectively destroyed its business.
According to Reuters, Nomi is seeking “unspecified compensatory, punitive and triple damages”.
"Nomi’s stolen innovations brought Estee Lauder into the information age, and Estee Lauder continues to profit from them wildly," legal representatives for Nomi told Reuters.
The lawsuit was filed a year after Estee Lauder announced plans to cut as many as 7,000 jobs worldwide as part of a cost-saving overhaul. Details of the group’s cost-cutting came as it revealed a $590m loss at the end of its second quarter in December 2024.
At the time, the company blamed weak demand for cosmetics at airports and subdued consumer spending in countries such as Korea and China.
The Independent has contacted Estee Lauder and Nomi for comment.
