AFP sues Philips for mammo breakup

November 4, 1992

AFP Imaging would like to be selling mammography systems rightnow, but it has no product. The Elmsford, NY, firm dropped itsmammography distribution agreement with Finnish supplier Soredexlast year in anticipation of selling systems provided by

AFP Imaging would like to be selling mammography systems rightnow, but it has no product. The Elmsford, NY, firm dropped itsmammography distribution agreement with Finnish supplier Soredexlast year in anticipation of selling systems provided by PhilipsMedical Systems (SCAN 12/25/91).

A Philips mammography system was shown by AFP in its boothat last year's Radiological Society of North America meeting.Halfway through the RSNA meeting, however, Philips pressured AFPto take the mammography system out of its booth. The U.S. firmhad already delivered one unit to a customer, according to DonaldRabinovitch, president.

AFP removed the unit from the booth in hopes that the Philipsrelationship would continue after the show. It did not. AFP isnow suing the Dutch imaging systems vendor for breach of contract.Philips would not comment on the issue, other than to confirmthat AFP has initiated litigation.

"It is entirely a contractual issue," Rabinovitchsaid. "We had been induced to work with them. We were interestedin working with them. We mutually agreed to work together. Wethen launched the program. We were presented with all of the toolsto do business, including but not limited to transfer of a pieceof equipment to us for the RSNA."

AFP is suing for damages, not restitution of the sales agreement,he said. The firm is considering several alternative mammographysuppliers, but has not yet chosen one. Relationships the firmmight have formed when it decided to work with Philips are nolonger available.

"At the time, we had a number of (mammography distribution)opportunities. We chose one and closed the doors on the others,"Rabinovitch told SCAN.

The reason Philips changed its mind halfway through the 1991RSNA meeting apparently involved its relationship with Pauschof Germany, the actual manufacturer of the mammography system,and with imaging competitor Siemens.

Siemens and Philips sell the same basic Pausch system manufacturedin the same plant, Rabinovitch said. The two major imaging systemsvendors then modify this system for sale under their own label.