ROUND 2: MORGAN STANLEY V. LVMH/2 BARNEYS IN BLACK/2 Women’sWWD Wear Daily • The Retailers’TUESDAY Daily Newspaper • March 4, 2003 Vol. 185, No. 44 $2.00 Ready-to-Wear/Textiles Go Gently MILAN — There’s plenty to be said for pretty, graceful clothes, and Giorgio Armani stated it eloquently in the notably feminine fall collection that he showed on Monday. The focus was on short lengths, in the form of minis and shorts, along with abbreviated jackets, and a palette that ran to black, white and gray. Here, his little fluted skirt, soft camisole and bold coat. For more on the shows, see pages 4 to 7. Pinching Pennies: Designer Runways Take Budget Route By Robert Murphy PARIS — If you end up sitting on a raw wooden bench during the European shows, it could be an artistic statement by the designer -- or more likely it’s a sign of the times. It’s chic to be fashionably frugal these days. As the international fashion pack winds down their stay in the gray of Milan and continues the Continental fashion season in Paris, stories abound about cutting back on fashion IANNONI G spectacles that can easily run NNI A See The Big, Page12 IOV G Y B PHOTO 2 2003 4, LVMH, Morgan Stanley Spar in Court WWDTUESDAY Ready-to-Wear/Textiles By Robert Murphy before they present a defense. there was no obligation on Represented in Paris by the Morgan Stanley to file its de- MARCH , PARIS — The second install- law firm Gide Loyrette Nouel, fense today.” GENERAL ment of the courtroom battle Morgan Stanley requested She added, “The court agreed Giorgio Armani, Fendi, Ferré and Ferragamo were among the top collections here pitting luxury giant LVMH LVMH be required to produce today that Morgan Stanley’s ap- 4 as Milan runways cruised on. against American investment evidence that the bank suspect- plication should be heard.” It’s chic to be fashionably frugal. While fashion spectacles still can run over TUESDAY , bank Morgan Stanley ended ed LVMH has sheltered from the A source familiar with the 1 $500,000, the days of extravagant spending are more or less on the wane. D Monday in procedural bickering court. It also requested that case said LVMH was concealing W as each party blamed the other LVMH be forced to explain the its hand and hoping to lead the LVMH and Morgan Stanley ended their court day Monday in procedural W of tactical posturing. relevance to the case of docu- bank into a legal minefield. 2 bickering as each party blamed the other of tactical posturing. LVMH Moët Hennessy Louis ments on a 1,900-page CD-ROM. The source cited three recent Barneys New York reported estimated results for the fiscal year ended Feb. Vuitton, the world’s largest luxury Paris’ Jeantet Associes law articles in the French press in 1 showed improvement in both the top and bottom lines. group, launched its $100 million firm represents LVMH. which LVMH sources hinted the 2 bias and conflict of interest suit When the meeting recessed, group possessed undisclosed ev- EYE: Finding one’s place…A “Pick Up” for the fashion crowd…Call him against Morgan Stanley last year. the wrangling moved outside idence to bolster its case. 9 Karl the Piano Man…Who wants to live forever? In it, LVMH assembled 41 the courtroom, as the legal “Morgan Stanley can’t defend Classified Advertisements ..................................................................22-23 pieces of evidence it claims will teams convened impromptu itself if LVMH doesn’t play its To e-mail reporters and editors at WWD, the address is prove the bank’s chief luxury ana- press briefings. cards straight,” said the source. lyst, Claire Kent, intentionally un- “Morgan Stanley is throwing “It has to know what it’s up [email protected], using the individual's name. derrated LVMH stock to make its up smoke screens,” complained against.” SUBSCRIPTION RATES U.S. and possessions, Retailer, daily one year, $99; Manufacturer, daily one year, $135. arch rival Gucci, which is advised Georges Terrier, LVMH’s chief The source likened LVMH’s All others U.S., daily one year $195. Canada/Mexico, daily one year, $295. All other foreign (Air Speed), daily one year $595. Please allow 6-8 weeks for service to start. Individual subscription information: (800) 289-0273; by the bank, appear attractive. legal counsel. “They’re nitpick- 1,900-page CD-ROM to the outside U.S. (856) 786-2140; group subscription information (856) 786-0963. The battle began in Paris’ ing over procedure without ad- equivalent of a mind-boggling Postmaster: Send address changes to WWD, P.O. Box 10531, Riverton, N.J. 08076-0531. WWD (ISSN #0149-5380) is published daily except Saturdays, Sundays and holidays, with one additional commercial court in January as dressing the core of the case. It maze with little relevance to the Friday issue in February, April, May, June, August, September, October and December, and one Saturday edition in evidence and other documents shows they’re in a weak posi- case. The source added that the January, April, August and November, by Fairchild Publications, Inc. a subsidiary of Advance Publications Inc., 7 West 34th Street, New York, NY 10001-8191. were exchanged in a brief ses- tion. They are buying time.” documents had perplexed WWD is a registered trademark of Fairchild Publications Inc.© 2003 by Fairchild Publications Inc., a subsidiary of Advance Publications Inc. All rights reserved. sion. A judge had set Monday as A Morgan Stanley spokes- Morgan Stanley’s lawyers. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, the date for Morgan Stanley to woman countered by saying that, Meanwhile, LVMH responded including photocopying or recording, or by any information storage or retrieval system, except as may be expressly permitted in writing by the copyright owner. Editorial Reprints: (212) 221-9595 respond to the allegations. “Today’s hearing was one of a to Morgan Stanley’s demand for Periodicals postage paid at New York, NY and other offices. But, in an equally expedient, number of procedural hearings. further explanation and evi- Mailed under Publications Mail Sales Agreement No. 517054. Canada Post Returns to: P.O.Box 1632, Windsor, ON N9A 7C9 GST # 88654-9096-RM 0001 Canada Publications Agreement # 40032712 closed-door session, Morgan There was no mention by the dence in a short document it Printed in the U.S.A. Stanley’s lawyer’s asked that two court of the defense. Despite handed the bank’s legal team two All signed articles published in the paper represent solely the individual opinion of the writer and not those of WOMEN’S WEAR DAILY. procedural aspects be addressed LVMH’s claim to the contrary, Continued on page 8 For Web site access, log on to www.WWD.com Barneys Looking Better in Tough Times In Brief By David Moin G Total sales of $383 million, G A CHALLENGING DISCUSSION: The Council of Fashion versus $371.2 million in 2001. Designers of America and Gen Art are teaming up to host their NEW YORK — Barneys New While some of the gains were first panel discussion on March 25, called “The Future of Fashion: York may be in a quiet period to be expected in light of the A Panel Discussion on the Challenges Facing Young Designers due to a $90 million private sharp declines right after the Today.” The panel, which includes designers Narciso Rodriguez placement for senior secured terrorist attacks on Sept. 11, and Rebecca Taylor, attorney Elizabeth Pearce, Julie Gilhart from notes, but the store actually has 2001, Barneys has been cutting Barneys New York and Vogue’s Sally Singer, will be moderated by something to crow about. costs, watching expenses and Bridget Foley, vice president and executive editor of W and WWD. On Monday, the luxury spe- renovating much of its selling The event will take place at the Graduate Center of the City cialty chain reported estimated space to increase productivity University of New York at 365 Fifth Avenue at 7 p.m. results for the fiscal year ended in best-selling, higher-margin Feb. 1 showing improvement in categories, such as shoes, acces- G LIZ TEAMS WITH LIFETIME: In partnership with Lifetime TV’s both the top and bottom lines, sories, private label and con- annual campaign to stop violence against women, being held this despite plummeting consumer temporary sportswear. It’s also week, Liz Claiborne Inc. has created a specially designed scarf and confidence and the harsh envi- been managing inventories bet- tie being delivered to political leaders and advocates, including all ronment throughout retailing. ter, and last year negotiated members of Congress, through Friday. During this week, Liz Among the highlights in the more favorable rents. Claiborne is encouraging these influentials to wear the scarf or tie preliminary report: The yearend results were as a symbol of unity of men and women working together to stop vi- G Net income of $7.5 million, contained in documents filed olence against women. Paul Charron, chairman and chief execu- compared with a $15.2 million with the Securities and tive officer of Claiborne, is set to attend a White House roundtable loss the year before. Exchange Commission due to Barneys’ chairman and ceo Howard session Wednesday to discuss the issue of violence against women. G Operating earnings dou- the private placement. Final au- Socol is leading the store’s rebound. bled to $29.7 million, from $14.5 dited figures should be released G HARTMARX DATE SET: Hartmarx Corp.