Blank Rome ... 6/4/07

PHILADELPHIA,MONDAY,JUNE 4, 2007 THE OLDEST LAW JOURNAL IN THE UNITED STATES Blank Rome Represents Victorious Brand Owner in Bongo Jeans Lawsuit BY ASHER HAWKINS as part of its attempt to breath new life into persuaded by the Of the Legal Staff the Bongo brand, Iconix hooked up with plaintiffs’ presenta- Hubert Guez, a member of a French fami- tion of extensive evi- They were big in the ’80s, and their most ly with years of experience in the apparel dence detailing the recent owners wanted to restore them to industry and L.A. area–based production extent to which the their former glory. and distribution capabilities. defendants allegedly But the push to revitalize the Bongo jeans But by 2005, the Iconix plaintiffs had overcharged their brand led to a multimillion-dollar breach filed suit against the Guez-related defen- East Coast business action between the new management’s West dants. The Iconix group claimed the Guez partners. Coast–based production/distribution wing defendants had misrepresented their per- Using testimony SMITH and East Coast–based brand owner. formance capabilities and then gone on to from plaintiffs’ The brand owner, which was ultimately systematically overcharge the Iconix plain- accounting expert Ed McKee of Lain Faulkner awarded verdicts totaling more than $50 tiffs for inventory that wasn’t even up to & Co. in Dallas, Texas, Smith said he and his million, was represented at trial by James standard. co-counsel showed the jury how, for example, Smith of Blank Rome in Philadelphia. The Southern California–based Guez certain inventory was put on the books for one The trial in Unzipped Apparel v. Sweet defendants filed a cross-complaint alleging day and then quickly removed, even though Sportswear lasted much of the winter and that their East Coast–based partners had the transaction accrued interest as if the inven- spring in a Los Angeles state court. failed to provide financing that would have tory had been on the books a full 30 days. The brand owner, Iconix Brand Group, is been vital to the venture’s operations and Smith said that jury selection began on a diverse concern that started with Candie’s then interfered with the defendants’ attempts Jan. 22. After weeks of testimony, in early women’s shoes and has in recent years come to independently secure their own sources of April the jurors went into deliberations to to control popular labels such as Rocawear capital. consider both sides’ claims for compensa- urban clothing, Danskin active wear, The Iconix plaintiffs were represented at tory damages. London Fog raincoats, Ocean Pacific surf- trial by Smith and fellow Blank Rome attor- After about four days’ deliberations, they wear, Mossimo youth apparel and Joe Boxer. neys Brian Paszamant and Judd Serotta. returned April 9 with verdicts in favor of the Bongo brand denim was one of Iconix’s The Guez parties were defended by Iconix plaintiffs and against the Guez par- earlier acquisitions. You may not be too lawyers from Browne & Woods in Beverly ties, on both sides’ actions. The combined familiar with the brand if you weren’t in Hills and the Law Offices of Gary Freedman compensatory damages for the Iconix par- middle school during the acid-wash phase in Santa Monica. Neither firm responded to ties totaled roughly $45 million, Smith said. of the mid-1980s to early 1990s, but Iconix calls seeking comment. The jurors next considered punitive dam- has been seeking to change that since Smith said in a recent interview that he ages as to Guez personally. On April 17, adding Bongo brand to its portfolio roughly believes the jury in Unzipped, who heard tes- Smith said, the panel members returned a decade ago. timony from approximately 35 witnesses with a $5 million punitive damages finding Court papers in Unzipped indicate that during the months-long trial process, was against Guez. • REPRINTED WITH PERMISSION OF THE LEGAL INTELLIGENCER.

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