Chanel and Cartier watches may both be pretty, but the litigation involving the two sides and a common watch retailer sure is ugly.
Chanel Inc. has sued Tourneau for breach of contract after the retailer shut down a Chanel boutique in its main Manhattan “TimeMachine” location earlier this year. Chanel also named watchmaker Cartier, owned by Switzerland-based Cie. Financiere Richemont SA, as a defendant in the suit.
Chanel claims that the two companies’ business dealings directly resulted in the closing of the Chanel boutique just months after it had opened. The company seeks $15 million in damages.
According to Bloomberg, Tourneau had sold Chanel watches in two of its stores since June 2011. In early 2013, the two companies decided to expand their business dealings, and in July, Tourneau opened a Chanel boutique in Manhattan.
However, according to the lawsuit, Tourneau feared a backlash from other retailers for the boutique. When Cartier officials toured Tourneau’s stores in August and saw the boutique, CEO Stanislas Chauveau De Quercize reportedly told the retailer to “tear down the Chanel boutique or lose the business of Cartier.”
The lawsuit states that, against the two companies’ contract, Tourneau notified Chanel it was dismantling the boutique in September and promptly did so in early December. Now, the lawsuit says, “the former location of the Chanel boutique currently stands empty of any commercial use by Tourneau, and is occupied only by two large Christmas trees and a small model of a reindeer.”
A spokesman for Chanel says that the company is no longer selling watches in Tourneau stores. Tourneau and Cartier both did not respond to Bloomberg requests for comment.
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