Hedi Slimane’s departure from Saint Laurent in the spring of 2016 came with far more than a quiet, final bow at the end of a fashion show. The conclusion of the nearly-4-year-long tenure of the famed former artistic director of Saint Laurent – which was confirmed in April 2016, following weeks of rumors that the French designer and the Paris-based brand would go their separate ways – was sealed with a messy, multi-faceted legal battle, making it clear that from a legal perspective, at least, the parties’ dealings were only just beginning.
Two months after YSL-owner Kering confirmed that Slimane was out, counsel for the 51-year old designer filed a headline-making lawsuit, initiating what would become the fashion industry equivalent of an ugly, high-stakes divorce. However, instead of fighting for custody of children or millions in alimony or the summer house in Southampton, Slimane and Kering would go head-to-head over a common contractual provision: a non-compete clause.
In his June 2016 complaint, Slimane asserted that Kering had failed to properly enforce the non-compete clause that was included in his contract. In doing so, the conglomerate that plays parent to Gucci, Balenciaga, Brioni, and Bottega Veneta, among other brands, freed the high-profile designer of the contractual limitation that would otherwise legally prevent him from working for a competing brand for a year. More controversially, though, in failing to uphold the non-compete, Kering cut off compensation to Slimane, which would have coincided with the non-compete period. In short: Kering allegedly failed to pay Slimane the $13 million he would have been owed had the non-compete been put into action.
In a preliminary hearing in July 2016, a French labor court determined that Kering was on the wrong side of the law, and that it owed Slimane the $13 million, likely a result of the fact that in accordance with French law, an employer “cannot unilaterally waive [a] non-compete obligation unless the clause … provides so,” according to Proskauer Rose LLP. (Editorial note: It seems strange that a sophisticated entity like Kering would not include specific language giving it the option to enforce – or not enforce – the non-compete).
Kering swiftly appealed the $13 million decision, but Slimane’s fight against it was hardly a one-and-done scenario, and was set to escalate.
Four months after Slimane first aired his grievances with Kering by way of the public forum that is the court system, his legal team doubled down, and filed another lawsuit against the luxury goods conglomerate. This time, Slimane’s counsel argued that the $13 million sum that the French Labor Court ordered Kering to pay was woefully inadequate, as it did not take into account an additional clause in Slimane’s contract, one that guaranteed he would be paid “compensation after taxes of at least €10 million a year” – or $11.5 million (based on exchange rates at the time) – as tied to the minority ownership stake that he had in YSL.
For the 12 month period from April 1, 2015 to March 31, 2016, Slimane – who joined LVMH-owned Celine as creative director in early 2018 – allegedly received just €667,402 ($823, 000 based on exchange rates at the time). He argued that he still owed more than $10 million, and the court agreed. In March 2018, a French commercial court ordered Kering to pay €9.3 million ($11.5 million) in order to fully compensate Slimane in accordance with the terms of his contract. Kering again appealed.
Finally, Slimane raised a third issue, which is still on the table. He requested that the court force Kering to honor his since-extinguished shareholder’s agreement, which gave him certain rights as a “minority shareholder” in Saint Laurent. According to Slimane, Kering terminated the agreement upon his departure from his role at YSL.
Two of those matters went before the Commercial Court of Paris this month and in decisions dated December 3, the court sided with Slimane on both accounts.
Primarily, the court denied Kering’s quest to appeal the earlier decision, which required it to pay Slimane the $13 million sum associated with his non-compete. In addition to upholding that decision, the court ordered Kering to foot Slimane’s $45,000 legal bill as a result of the loss. Second, the AFP reports that the court determined that Kering’s decision to put an end to Slimane’s shareholder’s agreement amounted to an “irregular unilateral termination,” thereby, settling that issue, while leaving Kering’s appeal over the sum to be paid in connection with Slimane’s final year at Saint Laurent still pending.
The legal squabbles follow from an impactful tenure at Saint Laurent during which time Slimane – who got his start at LVMH-owned Dior Homme in 2000 – controversially dropped the “Yves” from the branding for the esteemed house’s ready-to-wear collection, re-introduced couture after the 58-year old brand opted to focus on more wearable offerings, and reinvigorated the brand’s revenues thanks to his rock-n-roll-centric wares (from distressed skinny jeans and supple leather moto jackets to covetable handbags and footwear). As the New York Times reported in connection with the news of Slimane’s vacating of the artistic director seat at YSL in April 2016, under the designer’s watch, “the once-sluggish Saint Laurent [became] a commercial powerhouse, reporting slightly less than 1 billion euros, or about $1.14 billion, in revenue for 2015, up 38 percent from 2014.”
As for Kering, it described Slimane’s “four-year mission” at YSL as consisting of “a complete repositioning” and “holistic reform” of the brand, one that helped to bring “back its utmost modernity and fashion authority.”
A rep for Kering told TFL that they do not have a comment on the legal proceedings.