The courts don’t stop for the pre-Christmas rush.
Oing — who presided over Macy’s Inc.’s high-profile battle against Martha Stewart Living Omnimedia and J.C. Penney Co. Inc. — ordered the temporary restraining order on Wednesday. It was set to last until a Jan. 10 hearing on the matter, which is still going forward.
Herrera has claimed the non-compete agreement is in force until April 8.
A statement from Oscar de la Renta said: “We are pleased with the court’s decision today to reverse the temporary restraining order that prevented Laura Kim from returning to our company where she worked for over 12 years before being recruited by Carolina Herrera. We look forward to returning on Jan. 10, 2017, to fully brief the court on the non-compete matter and to more fully answer the claims in the lawsuit brought by Mrs. Herrera and her team.”
On Monday, a spokesman for de la Renta added, “This oddly timed and ill-advised lawsuit brought by Carolina Herrera makes very little sense to us. We are happy to welcome back Laura Kim and Fernando Garcia to Oscar de la Renta and we are thrilled to have made a significant equity investment in Monse. Our intention is to defend ourselves vigorously against the claims brought by Carolina Herrera and we are confident that once the court is made aware of the full factual context of the actions of Mrs. Herrera and her company that preceded the lawsuit, the court will agree that those claims are entirely without merit.”
On Friday, discussing the court’s dismissal of the temporary restraining order, the Herrera company said, “The company, Carolina Herrera Ltd., understands and appreciates the judge’s reasoning for today’s decision, which is to ensure the January 10 hearing is the final word on the question of the preliminary injunction. It’s important to note the judge put the opposing parties on notice that if he grants the preliminary injunction, they will be prohibited from using any and all work product they have jointly created if they choose to work together before January 10. We are satisfied with this decision and look forward to continuing to pursue this matter.”
While Carolina Herrera herself is not a party to the lawsuit — it was filed by the company, not Herrera personally — the designer, the company’s chief executive officer Francois Kress and chief operating officer Giuseppe Celio are mentioned throughout the court papers and Kim’s affidavit. Both make it clear that Herrera is creative director of the brand, even as Kim alleges Kress was trying to “transition” her out of that role and for Kim to take over.
The about-face by the court is just the latest twist in a fast-moving legal drama that exploded this week.
The houses of Herrera and de la Renta are staunch competitors and the suit has shined a spotlight on the inner workings of designer fashion.
Herrera sued de la Renta and Kim this week to enforce Kim’s non-compete agreement. Kim, who worked at de la Renta for 12 years, moved over to Herrera for about 10 months, but was transitioning back to de la Renta as co-creative director with Garcia.
A letter filed with the lawsuit from Herrera’s lawyer Holland & Knight said the non-compete agreement was extremely focused in that, “Carolina Herrera has no objection to Ms. Kim working for any fashion house other than Oscar de la Renta, Carolina Herrera’s direct competitor.”
Although the Puig-owned Carolina Herrera business is bigger, its primary category is fragrance. The de la Renta business is centered on ready-to-wear and accessories. The court papers allege that if Kim is allowed to design for de la Renta before April, Herrera could lose business at such key clients as Bergdorf Goodman, which has carried the Herrera label since it was launched in 1981. De la Renta also continues to have a substantial business at the Fifth Avenue store. The Herrera company claims in the suit that Bergdorf’s cut back on de la Renta’s space at the store in favor of Herrera during the time Kim was designing for Herrera. However, a company spokesman denied that allegation, saying, “Any statement or claim by any party that Bergdorf Goodman reduced Oscar de la Renta’s space within the store is false.”
Kim and her colleague Garcia, who also design the Monse label, consulted for Herrera in fall 2015, and Kim became the company’s senior vice president for design in January, with an annual salary of $450,000.
The employment agreement required that Kim give Herrera three months’ notice when she intended to resign and stipulated that the company could “at its discretion” elect to exercise a six-month non-compete provision.
In September, just after word spread that Kim and Garcia were rejoining de la Renta as co-creative directors — Francois Kress sent Kim a letter putting the non-compete provision of the contract in force.
Herrera’s suit said Kim is getting 50 percent of her monthly base salary during the non-compete period.