Becker & Poliakoff

Litigation as an Opportunity to Grow Your Business

Litigation as an Opportunity to Grow Your Business

Becker & PoliakoffPerry Ellis is a Fortune 500 company that trades publicly on the NASDAQ. But like so many successful companies, its story is that of a small humble company who was strategic in its growth and used an opportunity presented in litigation to help propel its growth.

It was started by George Feldenkreis, who came to this country fleeing communism in Cuba back in the early 1960’s. He initially opened a company that set out to trade automobile parts. But he quickly realized there was a need to manufacture “Mexican wedding shirts.”

His company was initially called Supreme International. He quickly grew Supreme into a behemoth. But Supreme was not a recognizable name in the fashion industry.

Conversely, Perry Ellis was a world-renowned fashion designer. He also had a company that was embroiled in litigation, and which ultimately filed for bankruptcy protection.

In bankruptcy a group of attorneys assumed that they could run the company. But they could not. They soon realized that they had to sell it.

Enter Supreme. It was the perfect marriage. Supreme had the necessary know-how and was in the fashion space. They were a growing company, but did not have the necessary name to take the company to “the next level.”

Supreme purchased all of Perry Ellis’s intellectual property from bankruptcy. While they spent millions of dollars in the process, it was one of the best investments they ever made. The name change and the re-branding provided the credibility it needed to continue to grow.

Litigation is often seen as costly and adversarial. However, litigation also presents opportunities for parties to not only resolve their differences, but also to enhance their position in the marketplace. Supreme’s acquisition of the Perry Ellis name is only one illustration of using litigation to enhance one’s position in the marketplace. It could be the purchase of distressed assets, or even real estate, but there is always opportunity lurking in litigation. If you see a potential opportunity, or wish to discuss Perry Ellis’s rise to prominence, then please don’t hesitate to contact me to discuss further.