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Investors at BriteSmile Inc. have little to grin about these days.
At this time last year, the Walnut Creekbased tooth-whitening company was on top of its world. With the rest of the market in a tailspin, BriteSmile saw its stock climb a whopping 500 percent during the first half of 2001. Consumers, it seemed, were ignoring signs of an impending recession and plucking down $500 a pop to undergo the company's patented toothwhitening procedure, which was being promoted heavily by radio personalities and infomercials in upscale markets such as New York, Boston and Beverly Hills, as well as the Bay Area.
But a year of economic decay and terrorist attacks clearly have taken their toll on BriteSmile. Quarterly revenues are more than 25 percent below their pre-Sept. 11 levels partially the result of a drop in so-called vanity spending, which typically is one of the first segments to take a hit when consumer confidence plunges. As a result, the company's once-high-flying stock has plunged more than 75 percent from its record high of $14.24 last June.
Now, a nasty legal battle with a top rival may put a...