In what LVMH lawyers heralded as an unprecedented move, Paris' commercial court, the Tribunal de Commerce, ordered Vivastreet in November to block ads for all LVMH-owned scent brands, including Guerlain, Kenzo and Christian Dior; the court also agreed to impose a fine of 500 euros, or $730 at current exchange, for each LVMH fragrance sold through vivastreet.fr in the future.
"What is really new here is that the injunction doesn't rely on the alleged liability of the Web site and doesn't try to compensate for the past situation, but gives a solution for the future by ordering the Web site to block a priori," explained LVMH's lawyer Nicolas Brault, who is a partner of Watrin Brault Associates. He said until this injunction, LVMH would have had to check the site daily and order its ads to be removed on a case-by-case basis.
The court ruled that selling LVMH's fragrances outside of its chosen selective-distribution channel is illegal in France, where prestige beauty manufacturers have tight control over the environment in which their products are sold. Brands here have the right to pull their products if certain criteria, including a high level of service, are not met.
Since the injunction, a warning appears on vivastreet.fr for anyone who tries to place an ad for an LVMH scent. And when buyers search for such a product — like Dior Midnight Poison — a notice informs them it is unavailable.
In the meantime, Brault said LVMH has sent a copy of the injunction to a dozen similar sites. He believes most people purchasing prestige fragrances from unlicensed sites are unaware they are acting illegally and so will stop once warned.
"For the rest, if they go elsewhere, we will follow," he said.
A Vivastreet spokeswoman said the company has not yet decided if it will appeal the ruling.
— Ellen Groves
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