California-based sportswear brand Modern Amusement is undergoing a restructuring that includes the departure of its chief executive officer, the elimination of most of its staff and a likely change to its master licensing agreement, WWD has learned.
This story first appeared in the December 10, 2009 issue of WWD. Subscribe Today.
Michael Boyes, who inked a five-year master license for Modern Amusement in December 2008 with brand owner Mossimo Giannulli, left the company last month. Boyes was the ceo and founder of Blk Brd LLC, a company he set up last year specifically to operate the Modern Amusement business. Boyes did not return e-mails seeking comment and Modern Amusement declined to clarify the status of the license agreement.
In an e-mail, Nicole Castrogiovanni, vice president of sales at Modern Amusement, wrote: “There is a dispute with prior management and, as such, we need to be brief in our communication. In November, Modern Amusement restructured our operations. We have not closed our business. We look forward to the new year ahead with the brand.”
Castrogiovanni is one of just a few employees who remain at the company’s Costa Mesa, Calif., offices. Most employees were laid off last month, according to sources. Additionally, Modern Amusement ended its agreement with an outside public relations firm responsible for promoting the brand.
Boyes had moved Modern Amusement to Costa Mesa last year from its previous headquarters in Santa Monica, Calif., after signing his license agreement with Giannulli. The move was in order to consolidate back-office functions with another company, Toolshed Sports, a maker of performance undergarments for athletes, where Boyes also served as ceo.
However, Boyes exited the ceo post at Toolshed Sports in August and the two companies severed their ties, according to Gregg Olson, an owner of Toolshed Sports. “He was spending a lot of time on Modern Amusement and he needed to focus his time on that,” said Olson, who is a former pitcher for the Baltimore Orioles. “We weren’t getting much done on the retail side of Toolshed.”
With Boyes out of the picture at Modern Amusement, some observers speculate Giannulli may seek to reposition the brand away from premium boutiques and toward lower-priced chain stores with a new license agreement — as he had previously done with his own Mossimo brand and the Paul Frank label, in which he also holds an ownership stake. Modern Amusement declined to make Giannulli available for comment.
Vince Gonzales, who operates the Encore showroom in New York that represents Modern Amusement on the East Coast, said he was unaware of the management and license changes occurring at the brand. “As far as I know, spring orders are intact and they are shipping,” he said.
Originally founded by Jeff Yokoyama, Modern Amusement was acquired by Giannulli in 2004. It was sold to Iconix Brand Group in 2006 as part of a $119 million deal for the Mossimo brand, but Giannulli bought back Modern Amusement for $4.8 million.