definitely a problem. this is called popeye. if left untreated can result in eye or fish loss. i have found maracyn II to be great for popeye. usually comes from the fish getting scratched in the eye and bacteria getting in. it is not contagious, but you will want to use a hospital tank to cut down on the amount of meds required for treatment. use the treeatment for a full 7 days even if the symptons disappear.
hth
maggie