E-commerce and online auctions are here to stay; there is no question about that fact. Ignoring and appealing the French court’s ruling aside, eBay will more than likely face new challenges to its sale of luxury goods online- whether the goods sold are are authentic or counterfeit.

Fashion Lawyer had the opportunity to talk to someone with a unique point of view on this week’s big Fashion Law story: Michael Sheldon, CEO and Founder of Portero.com, a competitor of eBay.

Portero.com was just featured on Forbes.com as a pioneer in the new generation of online luxury goods auctions. I was interested to check out the company myself and to get Sheldon’s take on the eBay case, “grey goods” and the like. The interview begins after the jump. [Read more →]

Back in May, Fashion Lawyer covered the frenzy over Steve & Barry’s $10 dress.  In that piece, I wondered how S&B could stay in business while making clothing to sell at such low price points.  Thanks to a linkback to my article, I was tipped off to trouble on the horizon for the mass-market retailer.

Steve & Barry’s has the hired high-priced and high-profile law firm of Weil Gotshal & Manges LLP, and Reuters reports that the firm may churn out a bankruptcy pleading for its client as early as this week. 

The Wall Street Journal and BloggingStocks.com both recently covered this development, and it appears that overly-aggressive growth strategies are partially to blame for S&B’s cash-flow crunch.  The retailer had a habit of securing under-priced and vacant space in malls across the country.  S&B thought it gave the company an edge by contracting for open retail space at a lower cost.  However, it appears that the company had to front large sums of money to secure these new locations, and the new stores’ cash registers have not been covering the cost of this expansion. 

Of course the company can’t cover its expansion! The business model relies on quantity of consumers– many of whom are on the couch at home to save on gas, not driving to the mall to spend money they don’t have.  I love the idea of fashion for all and low-cost clothing, but the prices can’t be so low as to shutter the business.

We’ll follow the progress and see if S&B is able to bail out.

Look, we all know it’s illegal to make a knock-off of a luxury handbag.  Everyone walking down Canal Street, just minutes away, knows with absolute certainty that counterfeit goods are illegal.  Fashion Lawyer has covered the counterfeit topic for a long time.  Other blogs also cover the topic of counterfeits.

Well, the heady days of safe online havens for counterfeiters may be over, as eBay was slammed yesterday with a $63 million award payable to Louis Vuitton and others for allowing individuals to auction fake luxury goods on its website.  But the real question that popped up for Fashion lawyer yesterday was, what about the other grounds on which the French court punished eBay?  What about “grey market” goods?

Grey market goods are authentic products that are sold outside their normal chain of distribution .  An example would be an authentic Louis Vuitton “speedy bag” which is purchased by an individual at a Louis Vutitton retail store while on vacation in the U.S..  Let’s say that the person takes that “speedy bag” and sells it online, on a site like eBay, to a purchaser in a place like London.  Because of the difference in exchange rates and market conditions, the purchaser in London is able to secure the handbag at a lower cost than buying it new from the Louis Vuitton store. 

The “speedy bag” in the previous example is a “grey market good, beacuse it was sold under its market value, outside of the Louis Vuitton store or its pre-approved distributors (stroes like Neiman Marcus).

Great for the consumer, right?  They get the real deal envy-worth handbag at a lower price.  But is it legal? [Read more →]

Big ruling in the Fashion Law world on an otherwise slugglish Monday! Today a French court ruled in favor of Louis Vuitton’s parent company, LVMH Moet Hennessy Louis Vuitton, and ordered eBay 40 million euros (over $63 million U.S.) for selling counterfeit goods on the online auction site. The suit also punishes eBay for selling real goods outside the intended retail channel.

Louis Vuitton is entitled to 19.3 million euros ($30.5 million U.S.) of the damages awarded. Christian Dior Couture, Parfums Christian Dior, Parfums Kenzo, Parfums Guerlain and Parfums Givenchy will also share in the damage award in amounts determined by the court.

As a form of injunctive relief, the court ordered eBay to stop selling all products from the injured brands from today forward or face fines of 50,000 euros per day (almost $80,000 U.S.). Fashion Lawyer did a little search on eBay today and discovered that the company is blatantly disregarding the ruling. A search for “louis vuitton” yielded 3108 pending auctions of both real and fake LV goods.

Click on this link to read another article which explains a little bit about the background of this case and gives eBay’s response.

Shame on you, eBay!

A few weeks ago I had the pleasure of interviewing Elizabeth Kanfer, Fashion Director of Accessories for Saks Fifth Avenue. We chatted about what she does for Saks and how she got her job, the nature of trends in fashion and hot items on the radar for the upcoming months.

The interview begins after the jump! It’s full of useful info on how to break into a career in fashion, so it’s a must-read!! [Read more →]

While reading Inc. magazine yesterday, I noticed a feature on The Sharper Image- a reatiler which has declined tremendously in the market over the past few years.  The article also mentioned a scale-back for Ann Taylor stores.  What gives?  Is the recession to blame, or is it just overly-aggressive and ill-planned growth?

J.C. Penney also announced a plan today to decrease the number of store openings in 2009. The company has already reduced store renovations and openings this year, but Penney’s Bridge Plan- a strategic growth initiative- plans to make even more cuts in 2009, in order to maintain a strong financial position. 

To make matters worse, consumer confidence hit a 16-year low in the month of June.  The recession is certainly to blame for this, as consumers are anxious about the real estate market, job market, and high oil prices. The outlook for the next few moths is pretty gloomy, since consumers think jobs are “hard to get”.

It certainly seems that all of these factors are taking their toll on retail’s cash registers.  However, Swedish mass-market giant H&M seems to be riding high during these tough times.  H&M just opened its first Atlanta, Georgia store in Hotlanta’s new and trendy retail/ living development, Atlantic Station.  H&M opened its first Georgia-based store in May at the Mall of Georgia in Buford, and the company is planning two more Atlanta-area stores by the end of 2008. On top of that growth- H&M has two other store openings planned this year in Tokyo.

When do you think the economic tides will begin to turn for American-based retailers?  As always, comments are welcome and appreciated!

Today’s Women’s Wear Daily includes brief descriptions of new cases in the Fashion Law realm.

Top Highlights:

• Chanel vs. Fernanda E. Harrington for trademark infringement-  the French luxury company claims that the defendant used protected Chanel marks on purses and accessories.  Lawsuit filed in U.S. District Court in Atlanta on June 11.
• Gucci vs. Paulette Tyrrell-Miller, Real Deal Handbags and Authentic Style- the American branch of the Italian luxury goods company claim that the defendants are manufacturing and selling counterfeit copies of Gucci handbags. Lawsuit filed in U.S. District Court in Manhattan on May 21.
• Kenneth Cole vs. Reaction and Matthew Cho- The American sportswear company claims that Defendant used the Reaction and RXN trademarks both in Defendant’s business name in the production and sale of women’s apparel in order to confuse the buying public and to make it appear as though the Defendant’s business and products were associated with Kenneth Cole’s sub-brand. Lawsuit filed in U.S. District Court in Manhattan on June 6 in U.S. District Court in Manhattan.

What happens when you gather a room full of Fashion’s most impressive CEOs?  They share important information!  WWD and DNR hosted a CEO Summit last October, and recently the companies released a white paper which summarizes the outlook and trends in the Fashion industry which the Summit uncovered.

The white paper is a must read for industry insiders, as it gives a quick and succinct guide to what the new Fashion Business trends are, detailing such items as growth opportunities, the impact of online sales, and branding in the digital age.  Take a look at the white paper by clicking on the link below.

WWD/DNR CEO Summit Outlook White Paper

You know those towering editorial up-dos that grace the pages of Vogue?  Ryan Cotton makes those styles come to life for fashion shoots and runway shows.  He also happens to be Fashion Lawyer’s immensely talented hairdresser.

Kind as can be, Cotton was born in the Midwest and moved to New York about 7 years ago to pursue his career in hair.  He spends about half of every week freelancing on fashion shoots, doing celebrity hair, and, during Fashion Week, styling for the shows.  The other half of the week (thank goodness), he brings his cultivated, wearable, avant-garde touch to the Serge Normant at John Frieda Downtown Salon.

Cotton’s worked with an enviable list of clients like Mandy Moore, Leighton Meister, Jenny McCarthy, Maya Rudolph, and Jane Fonda.  As for runway: Marc Jacobs, Ralph Lauren, Donna Karen, and Rag & Bone- just to name a few.  I had a chat with Ryan recently, and I asked him all about his career.  The interview appears after the jump. [Read more →]

Late last week, the fashion world was abuzz with the news that actress Uma Thurman, named one of PeopleMagazine’s “most beautiful people”, had sued French beauty company, Lancome for using her likeness to sell its products after the expiration of her contract to be one of the brand’s faces.

Lancome was the first party to bring suit, asking the Federal court to shield against a lawsuit by Thurman. Instead of counter-suing, Thurman filed her own suit, alleging that Lancome violated her endorsement contract by using her likeness to promote products both on billboards in Canada and on Asian websites. She has asked for $15,000,000 in damages.

One question at issue is how the Federal court in Manhattan will handle the two suits. Since they involve the same set of facts, one of the two lawsuits will likely be dismissed. Fashion Lawyer will monitor the suit.