On May 30, 2000, Calvin Klein, Inc. (CKI) sued against Warnaco Group, Inc. and Linda Wachner, its CEO, for breaking its jeans wear certification and distribution contract and, in that way, watering down the equity of their brand. On June 26, 2000, Warnaco countered using its own suit, denying the main allegation of trademark dilution and justifying distribution through warehouse clubs as acceptable business practice. The counter-suit further stated that CKI had, actually, breached the license and eroded the company through its very own methods and practices. The legal cases were precedent setting: It was the very first time an authorized manufacturer/distributor have been billed with brand equity dilution or perhaps a designer attributed for ineffective brand advertising. It had been a case that will potentially rewrite the guidelines of favor certification and distribution, and produce in to the limelight the tensions faced by every brand steward trying to balance revenue growth goals with upkeep from the equity of the trademark. This case presents extensive background details.
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