In a case linked to the corruption trial of former state Sen. Joseph Montoya, the owners of a La Jolla mail-order contact lens firm filed a civil antitrust and racketeering suit Tuesday against Montoya and various optometric groups in federal court in San Diego.
Seeking $60 million or more in damages, the husband-and-wife owners of Dial a Contact Lens Inc. charged that five contact-lens makers and three optometric groups have tried to put them out of business. Montoya and an aide tried to extort money from them, the suit alleges.
Dieter and Jamie Hundt claim in the suit that Montoya--convicted of criminal racketeering in a probe of Capitol corruption--and an aide tried to shake them down in 1988 for thousands of dollars to kill or postpone a bill that would have effectively outlawed mail-order sales of lenses.
Montoya (D-Whittier) chaired a key committee considering the measure. The couple refused to pay the money, they said, and the bill died anyway.
Since then, the California and American Optometric Assns. and the Contact Lens Manufacturers Assn. have continued to lobby for a new, virtually identical bill, according to the Hundts, who testified against Montoya.
The five contact lens manufacturers, meanwhile, have refused to sell lenses to their mail-order firm or revoked credit lines they previously had extended, according to the suit.
The suit seeks $20 million in damages on the antitrust claims, which would be tripled under antitrust laws. The antitrust claims name the contact-lens makers, the three trade associations and the former president of the California Optometric Assn., Dr. Harry Charm of Anaheim.
The manufacturers named in the suit are Bausch & Lomb, Ciba Vision, the Cooper Cos. Inc., Allergan Inc. and Sola/Barnes-Hind.
The racketeering claims, brought against Montoya and aide Amiel A. Jaramillo, do not specify damages, but a successful suit would entitle the Hundts to treble damages and attorney's fees.
Lawyers for the defendants were not immediately known.
Montoya already is in a federal prison, serving a 6 1/2-year sentence, and one of the Hundts' attorneys, Patrick A. McCormick Jr. of San Diego, said Montoya might not play a central role in the case. But the Hundts said Tuesday that they named him in the suit to send a message.
"I want that he will tell about all his other (Capitol) colleagues doing same or similar things, because I know there are a bunch of them," Dieter Hundt said.
In February, a federal jury in Sacramento found Montoya guilty on seven counts of using his office for personal gain. He had been caught in an elaborate and long-running federal sting that continues and has focused on political corruption in the state capital.
Jaramillo, who served Montoya as the principal consultant to the Senate Business and Professions Committee, which Montoya had chaired, pleaded guilty in May to sting-related charges.
Dial A Contact Lens sends lenses at low prices to people who can furnish a valid prescription. By underselling optometrists, they have built their business in four years into a $1.5-million annual operation, Dieter Hundt said Thursday.
One of the ways the optometrists tried to drive them out of business, the suit contends, was through bills in the California Legislature in 1988 and 1989. Neither bill has made it into law.
During those two years, the California Optometric Assn. sponsored bills that would require that a contact lens seller personally examine the way lenses fit the eye.
The legislation was touted as a way to protect consumers from improperly fitting lenses. According to the suit, however, it was really designed to outlaw mail-order operations.
Jamie Hundt testified at Montoya's trial that they were unaware of the 1988 bill until they received a phone call from aide Jaramillo, who referred them to a Sacramento lobbyist--who, in turn, said it would take $50,000 to kill the bill and save their business.
With the bill set for an immediate Senate hearing, an additional $5,000 donation solely to Montoya would buy a three-week postponement of the matter, Hundt testified.
She said he and her husband refused to pay any money and, instead, mounted a grass-roots petition drive that derailed the 1988 measure.
"I had no idea big business ran in this fashion and no idea the Capitol ran in this fashion," she said Tuesday. "But what I've seen through this industry is that apparently it does, and it's not the way it should be run at all."