Startup Nomi Beauty has filed a lawsuit against Estée Lauder Companies in Manhattan federal court. The company alleges that Estée Lauder misused its proprietary technology and forced the startup out of business.

According to the complaint, Nomi developed a specialized platform to increase luxury beauty sales in hotels and duty-free stores. The system tailored product offerings to international travelers. As a result, brands could better target jet-setting consumers in high-value retail locations.

Nomi claims that Estée Lauder participated in pilot programs in 2018 and again in 2020. However, the beauty giant later ended the contracts. Afterward, Nomi alleges that Estée Lauder used confidential information from those pilots to develop similar initiatives internally.

Furthermore, the lawsuit states that Estée Lauder cut off supplies to hotels working with Nomi. This move, according to the complaint, disrupted the startup’s business model. Consequently, Nomi argues that it could no longer operate effectively.

The startup also claims that Estée Lauder has since generated billions of dollars in revenue from programs built on similar technology. Meanwhile, Nomi says it was pushed out of the market.

Broader Industry Implications

Industry analysts note that this case reflects rising tension between beauty-tech startups and large multinational corporations. As digital platforms and personalization tools reshape retail, intellectual property disputes are becoming more common.

Moreover, beauty innovation now relies heavily on data, algorithms, and proprietary systems. Therefore, disputes over trade secrets and confidential information may increase as collaboration between startups and global brands grows.

If the court rules in Nomi’s favor, the case could set an important precedent. It may clarify how intellectual property and trade secrets are protected within the beauty-tech ecosystem. On the other hand, a ruling for Estée Lauder could reinforce existing corporate partnership frameworks.

Ultimately, the lawsuit highlights a key shift in the beauty industry. Technology platforms now drive competitive advantage just as much as formulations or branding. As a result, legal safeguards around innovation have become more critical than ever.