March 31, 2022
OptoLum Closes its Doors
Another small lighting company gets late on payments and ultimately calls it quits. They might owe Cree up to $4.9 million, too.
TEMPE, ARIZONA -- In what appears to be a hastily written announcement sent to business partners yesterday, LED lighting maker OptoLum has announced that it is closing its doors after 20 years of business. In 2020, the Tempe, Arizona company reported having 11 employees. Earlier this month, long-time CEO Joel Dry was reportedly replaced by company co-owner Karen Baker. Today, OptoLum closes its doors due to what seems to be financial troubles.
OptoLum’s products included small scale linear and specialty LED fixtures that were commonly used for accent lighting and display cases. Multiple lighting agents have reported difficulty in doing business with the company during the recent 12-18 months, with the company’s communication, lead times and commission payments being described as either unreliable or nonexistent.
In some instances, the company responded to agents – admitting that they were behind in commission payments and that agent payments were high on the priority list, without offering a payment timeframe. In other instances, agents report simply having their phone calls and emails ignored.
One of the “warning signs” reported by OptoLum agents is that the company started asking for 50% order deposit at the time of order placement. The company explained that the money was needed to pay for the rising costs of materials and components. Then commission payments were being paid late. And then not at all. One agent reported that commissions stemming from a late 2020 order are still unpaid.
We emailed and called Karen Barker a few hours before the publish time of this article and did not receive a reply.
A potential $4.9 million legal bill
In 2017, OptoLum filed a patent infringement lawsuit against Cree, Inc. In recent months, final judgments in favor of Cree have put more financial pressure on OptoLum, as Cree is petitioning the court for OptoLum to pay nearly $5 million in legal fees.
According to Cree filings, on February 8, 2022, Cree consulted with OptoLum lawyers in an attempt to reach agreement on the attorney’s fees that should be awarded to Cree. The parties were unable to agree and are presently at an impasse.
On March 4, OptoLum filed an appeal to the judge’s order to grant Cree a summary judgment. Below is an excerpt of Cree’s petition to the court.
