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C. Wonder – Not So Wonderful According to Tory Burch

Posted in Branding, Law Suits

–Catlan McCurdy, Attorney

photo credit: nymag.com

Tory Burch, a designer known for her colorful, yet accessible preppy styles and signature double-T medallion, has a new contender to deal with in the fashion world, and unfortunately it’s her ex-husband and former business partner, Chris Burch. Chris opened up his own store in 2011, under the unfortunate name C. Wonder, which, hmmm sells clothes and accessories that look a lot like Tory Burch’s line. The C. Wonder line is lower-priced than Tory Burch, a tactic many see as an attempt to position C. Wonder as a competitor with Tory.

Tory, a businesswoman, fashion powerhouse, and fellow Pennsylvanian, seemed content to keep the courts out of this latest mess with Chris until recently. In October, Chris sued Tory for for tortious interference with his business and breach of contract, alleging that Tory had tried to hamper his relationships with suppliers. Tory responded by filing a counterclaim in early November, alleging that Chris violated his fiduciary duty to the Tory Burch company and that for a period of over two years prior to announcing his plans to launch C. Wonder, Chris “repeatedly asked for and was given full complete access to competitively sensitive information about the company and its best-selling products.” Chris was forced off the board of Tory Burch LLC earlier in 2012, but retains a 28.3% stake interest in the company. Tory also owns 28.3%.

Tory has alleged that C. Wonder “is a knockoff brand…with mass-market versions of the top-selling Tory Burch items.” In addition the highlighting similarities between the two brick and mortar stores (velvet curtains, lacquered and brass furniture, etc), Tory’s counterclaim also highlights similarities between the clothing and accessories sold at C. Wonder (gold hardware, colorful prints, etc). The counterclaim includes pictures of the clothing, starting at page 24 for those that are interested in judging for themselves. In addition to a breach of fiduciary duty claim, Tory has officially accused Chris of deceptive trade practices, unfair competition, misappropriation of trade secrets, and breach of contract. Judging from the comments already made by Judge Leo Strine during scheduling and the supposed involvement of a Russian billionaire, this case seems like the right kind of circus for me to follow. Stay tuned next month, and until then, you will find me in my office, sipping tea from my new delightful Tory Burch thermos.