Ex-Guess Chairman Sues Over Trademark Use : Fashion: Georges Marciano says his brothers and former partners are using family name on clothing without permission.
Georges Marciano, the former Guess Inc. chairman who presided over the company’s long-running and costly feud with a rival jeans maker, is now suing his former firm and his brothers, to whom he relinquished control of Guess in August.
The suit is the latest episode in a Marciano family quarrel and could be a prelude to a new business rivalry should Georges Marciano launch a new clothing enterprise.
Georges Marciano, who is credited by some with helping to develop the $7-billion-a-year designer jeans business, contends that Guess has infringed on the trademark he owns on the Marciano name and is violating a licensing agreement.
The suit, filed Dec. 20 in U.S. District Court in Los Angeles, accuses Guess of trademark violations, breach of contract and unfair competition. Specifically, it contends that Guess is violating the trademark and licensing agreement by selling clothing under the Marciano Collection label without the approval of Georges Marciano.
Also named as defendants in the suit are Guess top executives--all brothers of Georges Marciano--including Chairman Maurice Marciano, President Paul Marciano, and Armand Marciano, executive vice president.
The family feud is the latest in a series of disputes involving the Marcianos.
The brothers became well-known for the brutal legal battles they waged with another set of siblings: the Nakash brothers, who founded Jordache jeans. The Marcianos sold half the interest in Guess to the Nakash brothers in 1983 but had that sale rescinded as part of an out-of-court settlement in 1990, ending a six-year dispute that generated legal fees of $80 million.
Georges Marciano’s suit against his brothers comes within months of a dispute that led to the sale of his 40% interest in Guess to his brothers for $220 million. Georges Marciano reportedly felt Guess should expand its distribution beyond the existing department store customer base to include other retailers--such as Wal-Mart and Sears--and decided to leave the company because of resistance from his brothers.
However, the suit says Georges Marciano retained trademark ownership of his name--which is part of the logo on a wide range of Guess products--because he transferred those rights to Georges Marciano Inc., a company founded in 1983.
Under an agreement, Georges Marciano has licensed his name to Guess for use on products and for advertising and marketing programs, and that agreement includes the licensing of the Marciano surname, the suit says.
The suit contends that the licensing agreement prohibits Guess from associating other new names or characters with the Marciano mark on products or in advertising without the prior approval of Georges Marciano. However, the suit says that Georges Marciano learned in November that Guess was selling clothing under the Marciano Collection label without his authorization.
The suit also contends the Guess executives are falsely claiming that Georges Marciano approved the company’s new Marciano Collection label.
When Marciano decided to leave Guess, he reached an agreement Aug. 23 to terminate the licensing agreement on Aug. 24, 1994, the suit says.
Under the agreement, Guess can no longer use the Marciano name on products after that date, according to the suit.
Guess had no immediate comment on the lawsuit, which asks the court to halt the distribution of the new line. Georges Marciano could not be reached for comment, but one of his lawyers, Stephen J. Strauss, said a legal team is trying to determine what level of damages it will seek.
Georges Marciano might seek a substantial award from Guess, a $500-million empire that includes the jeans business, a line of women’s sportswear, a growing string of posh stores and licensing operations that have placed the Guess name on fragrances, watches and sunglasses.
Georges Marciano could seek up to three times the value of the profit from the sale of Marciano Collection clothing, said Anthony M. Keats, a lawyer specializing in trademark infringement cases at the Los Angeles offices of Baker & Hostetler.
Sales at Guess have risen rapidly. The company had earnings of $108.4 million on sales of $492 million in 1992, according to a prospectus recently circulated to potential investors.
Georges Marciano helped bring the tight-fitting look to American backsides when Guess was founded in 1981. He is considered a fashion originator and helped create the industry, which includes lines such as Calvin Klein and Armani.
