A Lifetime Friendship? Jacobs and Duffy Near New Deals With LVMH

Marc Jacobs and Bernard Arnault are near resolution of a contract dispute that would cement the designer as the creative force behind Louis Vuitton.

Marc Jacobs at the Louis Vuitton show in March

Marc Jacobs at the Louis Vuitton show in March.

Photo By WWD Staff

NEW YORK — Marc Jacobs and Bernard Arnault are on the verge of resolving their long-running friction, which at times had thrown the designer’s future as the creative force behind Louis Vuitton into question.

Robert Duffy, president of Marc Jacobs International, said Wednesday that he and Jacobs are likely to sign new employment contracts in a few weeks, although he left open the possibility that things could change. Speaking from Jacobs’ offices in Paris, where negotiations are ongoing, Duffy said his optimism about the future of their relationship with parent company LVMH Moët Hennessy Louis Vuitton was based upon a recent positive show of support by Bernard Arnault, its chairman.

“It’s been a struggle, but we’re hoping for the best,” Duffy said. “Nothing has been finished yet, but the most important thing is that we have Arnault’s commitment to making this work, with the proper investment for infrastructure.”

Jacobs and LVMH officials have been in prolonged discussions since last summer over the designer’s long-term role at Louis Vuitton, where he has made an enormous impact on sales — now surpassing the $3 billion mark — since he took over its artistic direction in 1997. Although Jacobs signed a seven-year contract in 2001 to stay on at Vuitton, rumblings began to surface more than a year ago that he and Duffy were unhappy with the investment that LVMH was, in turn, putting into the Marc Jacobs company, which has estimated sales of $300 million.

Insiders said that, in the wake of Tom Ford’s dramatic departure from LVMH rival Gucci Group, increasing tensions between the camps of Jacobs and Arnault led both sides to begin to reevaluate their relationship.

Duffy would not divulge what aspects of their employment are being discussed in their current contract negotiations, but sources described some of the points:

  • Jacobs and Duffy would cement their partnership with LVMH to guarantee the long-term growth of the Marc Jacobs business, making commitments to remain for what would be the duration of their professional careers.

  • LVMH would make a significant investment in Marc Jacobs’ infrastructure, with Arnault’s personal involvement in accelerating its business plans, which include an aggressive retail rollout, as evidenced by this week’s disclosure that Marc Jacobs has signed a real estate deal to open flagships and retain office space in Los Angeles.
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