Idexx Laboratories Inc. won't pursue a legal complaint it brought against Vets First Choice that involved suspected theft of proprietary information and employee poaching.
The company filed a notice of voluntary dismissal Wednesday in U.S. District Court in Maine, where both companies are based.
Vets First Choice had never filed a response to the complaint, which was lodged on Aug. 3. Instead, it requested and received repeated extensions on the deadline to respond while the two sides were in settlement talks.
Meanwhile, Vets First Choice merged with Henry Schein Animal Health, forming a company called Covetrus.
A statement Idexx and Covetrus issued jointly Wednesday says: "All parties, including the Covetrus employees named in the complaint, cooperated to bring this matter to amicable resolution."
The employees named in the complaint were Dan Leach and Agostino Scicchitano. Former employees of Idexx, the men left in December 2017 and April 2018, respectively, to take jobs at Vets First Choice, according to the suit.
Idexx is one of the largest veterinary diagnostic laboratories in the U.S. and also sells practice management information software to veterinary hospitals. It was established in 1984.
Vets First Choice was founded in 2010 as an online pharmacy and prescription management service working with veterinarians in private practice. In merging with Henry Schein Animal Health, the company now called Covetrus includes product distribution in its domain.
Idexx and Covetrus overlap in their interests in collecting and analyzing digital data from veterinary practices.
They share a family history, as well. Idexx founder David Shaw co-founded Direct Vet Marketing with his son, Ben Shaw. That company acquired VFC in 2010. Today, Ben Shaw is president and CEO of Covetrus, and David Shaw chairs its board.
The suit by Idexx had alleged that Leach, who as a business analyst had knowledge of proprietary company information, appeared to have taken confidential documents from his work computer in the two months before he left the company. The documents contained information unrelated to his duties and responsibilities at Idexx, according to the complaint.
The suit said Scicchitano, whose most recent role at Idexx was in employee training, similarly appeared to have accessed and downloaded files from his work computer in the month before he left Idexx.
The suit also said that Vets First Choice had hired at least nine people away from Idexx since 2017.
The complaint alleged that the series of activities “signals that VFC is attempting to jumpstart its business with IDEXX information and trade secrets."
In their joint statement Wednesday, Idexx and Covetrus said they "acknowledge their respective obligations to their customers and employees to take appropriate measures to safeguard and ensure proper handling of confidential information."
Idexx voluntarily dismissed its complaint with prejudice, meaning it cannot revive the suit based on the same set of facts. Each party to the suit is to cover its or his own legal expenses.
Correction: This article has been revised to correct information about the origins of Vets First Choice. Although the company maintains that David and Ben Shaw cofounded Vets First Choice in 2010, the launch of the business predates their involvement. For details, click here.