There’s a battle brewing between fashion-public relations powerhouse Karla Otto Inc. and luxury brand J. Mendel.
The international p.r. firm early this week told a local New York court that J.Mendel is in violation of a previous settlement agreement concerning the brand’s failure to pay $260,000 for work done by Karla Otto in 2016.
According to the February 2017 settlement agreement, Karla Otto signed on in May 2016 to represent J.Mendel for a monthly rate of $12,000, which totaled $110,287 by the time the two parted ways. The firm also claimed to be owed 297,131 euros for its work putting on the brand’s first couture show in July 2016 in Paris.
Karla Otto said the brand never paid up, but in order to end the dispute, it agreed to reduce the bill to $260,000. J.Mendel then agreed to pay, through monthly installments of $20,000, according to the settlement agreement. Karla Otto says it only received three installments, in February, March and April of last year, and one installment of $10,000 in May, before they stopped altogether.
Legal representatives of Karla Otto earlier this month notified J.Mendel executives of the default and the firm’s intention to sue should payment not be made in full, but to no avail. Karla Otto claims to have received no response at all.
The firm is asking the court to order payment of the full amount owed for p.r. services, plus 14 percent interest and reimbursement for all legal fees associated with the case.
A representative of J.Mendel and a representative of its most recent financial backer, Stallion Inc., which is independently owned by John Georgiades, could not be reached for comment. A representative of Karla Otto could not be reached for additional comment.
As of 2015, J.Mendel was said to produce about $30 million a year in sales from its ready-to-wear, including fur, along with couture, bridal and accessories lines. But the brand has not released a couture collection since the Paris show at issue in Karla Otto’s suit, nor does it appear to make accessories any longer.
J.Mendel also operates a stand-alone boutique in Manhattan and sells to high-end department stores Bergdorf Goodman and Harrods. It was headed for a wider expansion in 2013, when it was backed by Los Angeles-based private equity firm Gores Group, but before a full expansion was realized, the firm sold its stake to Stallion after apparently failing to find a partner with which to run the brand.
Its creative head and chief executive officer is Gilles Mendel, a fifth generation member of the family-run company that started in Russia as a furrier to the aristocracy. He looks to have taken up the role of ceo after the March 2016 departure of Marc Durie, who is now head of men’s shoes at Christian Louboutin in Paris.
Before Durie, luxury brand veteran Susan Sokol led the J.Mendel for five years, leaving in 2013. She subsequently started her own luxury brand consultancy and cofounded a showroom with Suzanne Zikas, president of Rachel Zoe Inc.
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