Benetton’s latest legal wrangle with its German retailers was adjourned yesterday (Tuesday) until next month as new players emerged in the escalating franchise fracas.
Benetton is suing German retailer Almondi to recover unpaid bills, but the eight-store franchise is making a counter submission that its business has been damaged by the Italian manufacturer’s controversial ad campaigns.
It is the second German retailer in the past two weeks to face legal action from Benetton and the second to use the ad campaign as justification for withholding payment for stock. Almondi, based in the Cologne area, is claiming damages in excess of £1m.
“This is the biggest claim so far,” says Almondi solicitor Ulfert Engels, who claims to represent 50 retailers interested in taking action against Benetton. “Every second day another Benetton retailer contacts me for advice,” he says.
Benetton alleges that the rebel retailers have suffered losses because of poor financial management rather than any damage from the ad campaign.
A second group of retailers have set up a pro-Benetton body to support the firm in Germany.
Benetton also faces court action in Paris where a HIV-positive person is claiming damages following its 1993 ad campaign featuring a forearm, lower abdomen and backside, branded with the words “HIV-positive”.
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