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W.L. Gore facing antitrust investigations

W.L. Gore & Associates, the family company that makes the waterproof Gore-Tex membrane used in outdoor sportswear, is facing antitrust investigations in the U.S. and Europe, the Wall Street Journal reported. W.L. Gore, a privately held company, is owned by members of the Gore family and associates.

The European Commission is planning preliminary investigations into complaints by competitors "by sending out questionnaires to Gore and other parties," the Journal report said. Last March, the U.S. Federal Trade Commission subpoenaed Gore as part of a formal antitrust investigation, the article reported.

Columbia Sportswear Co., a publicly traded company controlled by the Boyle family, has filed a formal antitrust complaint against Gore with European Commission antitrust authorities. Last year, Columbia acquired OutDry, a technology that competes with Gore-Tex, the Journal report noted.

OutDry's Italian inventors allege that Gore "demands exclusivity from outdoor clothing and sportswear brands," the article said. Columbia charges that those brands "fear losing their Gore-Tex license" because of consumers' perception that Gore-Tex is the only product of its kind -- an impression that Columbia contends is perpetuated by Gore's restrictions on its licensees, according to the Journal report.

Gore denies the allegations, the Journal article said. A company spokesman told the Journal that Gore has "confidence in the integrity of our business practices."

The Journal article said estimates of Gore's market share range from 70% to 90%. The article also noted that General Electric Co., which makes another competing technology, eVent, had been in talks with the FTC. In 2009, GE changed its marketing strategy for the product and stopped advertising the brand name as a competitor to Gore-Tex.

According to the Journal report, OutDry was invented in the late 1990s by two Italian brothers who decided to sell the company to Columbia after potential customers told them they couldn't use the product without endangering their licenses from Gore. (Source: Wall Street Journal, June 22, 2011.)

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