{"id":272573,"date":"2021-07-15T00:00:00","date_gmt":"2023-09-19T16:08:48","guid":{"rendered":"https:\/\/blog.jusmundi.com\/?p=272573"},"modified":"2023-09-19T18:08:48","modified_gmt":"2023-09-19T16:08:48","slug":"arbitrating-fashion-disputes-key-cases-analysis","status":"publish","type":"post","link":"https:\/\/dailyjus.com\/index.php\/2021\/07\/15\/arbitrating-fashion-disputes-key-cases-analysis\/","title":{"rendered":"Arbitrating Fashion Disputes: Key Cases &#038; Analysis"},"content":{"rendered":"\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>THE AUTHOR: <\/strong>Jus Mundi<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<div style=\"height:30px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Introduction&nbsp;<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">The fashion industry, like many industries, relies on cross-border transactions. These transactions are backed by contractual clauses providing for dispute resolution through international arbitration. While not many fashion brands appear before arbitral tribunals, such rare appearances can be spotted if the available cases are closely scrutinized.&nbsp;<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">At Jus Mundi, we decided to take up the challenge and examine the involvement of the&nbsp;<\/span><span data-contrast=\"none\">top fashion &amp; sports brands<\/span><span data-contrast=\"auto\">&nbsp;in arbitrations by looking into our comprehensive dataset of<\/span><span data-contrast=\"none\">&nbsp;<\/span><a href=\"https:\/\/jusmundi.com\/en\/coverage\/commercial-arbitration\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">commercial arbitration<\/span><\/a><span data-contrast=\"none\">&nbsp;<\/span><span data-contrast=\"auto\">awards.&nbsp;<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Below is a presentation of three intriguing cases dealing with fashion brands with interesting details and unexpected plot twists.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"text-decoration: underline;\"><a href=\"https:\/\/jusmundi.com\/en\/document\/decision\/en-prada-s-p-a-v-caporicci-usa-corp-final-award-wednesday-30th-january-2019\" target=\"_blank\" rel=\"noopener noreferrer\"><b>Prada v. Caporicci<\/b><\/a><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">In this first case, the dispute originated from a purchase agreement of 15,000 alligator hatchlings.&nbsp; Yes, you read it right! Prada and <\/span><span data-contrast=\"auto\">Caporicci, a company specializing in alligator <\/span><span data-contrast=\"none\">hatchling breeding services,&nbsp;<\/span><span data-contrast=\"auto\">agreed on the following contractual terms:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><i><span data-contrast=\"auto\">Prada is to p<\/span><\/i><i><span data-contrast=\"auto\">urchase from&nbsp;Caporicci&nbsp;all of the alligators\u2019 hatchlings born from the eggs (estimated to be 15,000 in number) to be procured by&nbsp;Caporicci;<\/span><\/i><\/li>\n\n\n\n<li><i><span data-contrast=\"auto\">Caporicci is to provide for the capture, incubation, shipping, logistics, initial care, vaccine, and feeding of the animals;<\/span><\/i><\/li>\n\n\n\n<li><i><span data-contrast=\"auto\">Caporicci is to raise on its farm the hatchlings purchased by Prada for a minimum period of 12 months and until Prada decides to transfer them to a different farm or elsewhere).<\/span><\/i><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559685&quot;:810,&quot;335559740&quot;:276}\"><br><\/span><\/li>\n<\/ul>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"alignleft\"><a href=\"https:\/\/blog.jusmundi.com\/wp-content\/uploads\/2021\/07\/Screenshot-2021-07-15-at-15.38.25.png\"><img decoding=\"async\" src=\"https:\/\/blog.jusmundi.com\/wp-content\/uploads\/2021\/07\/Screenshot-2021-07-15-at-15.38.25-300x213.png\" alt=\"\" class=\"wp-image-272590\"\/><\/a><figcaption class=\"wp-element-caption\">Credit: Everglades National Park<\/figcaption><\/figure>\n<\/div>\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">The Parties agreed in their purchase agreement that they would pay a price of USD 100 for each of the hatchlings born from the eggs procured by Caporicci, which also included a service of procurement of alligator eggs, transportation, incubation, and the care of minimum of 12 months.&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">What could have gone wrong?&nbsp;Caporicci&nbsp;was able to breed only 4,487 hatchlings instead of the acceptable minimum number of 12,000 agreed in the purchase agreement and refused to return the excess of prepayment of USD 1,200,000 as requested by Prada.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">After 3-months of silence, Prada submitted the dispute to international arbitration under the&nbsp;<\/span><a href=\"https:\/\/jusmundi.com\/en\/document\/rules\/en-international-arbitration-rules-of-the-chamber-of-national-and-international-arbitration-of-milan-2010-cam-milano-international-arbitration-rules-2010?su=%2Fen%2Fsearch%3Fquery%3DCAM%2520-%2520Milan%2520Arbitration%2520Rules%25202010%26page%3D1%26lang%3Den\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">CAM &#8211; Milan Arbitration Rules 2010<\/span><\/a><span data-contrast=\"auto\">, claiming breaches of the purchase agreement. Notably, Prada claimed that&nbsp;Caporicci&nbsp;had not procured all of the hatchlings per the letter of intent and had not paid back the difference between the USD 1,200,000 advanced by Prada. In defense,&nbsp;Caporicci&nbsp;opposed Prada\u2019s claims and contested having committed any breaches of the Agreement.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Arbitration&nbsp;<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">The arbitration seated in&nbsp;<\/span><a href=\"https:\/\/jusmundi.com\/en\/search?page=1&amp;lang=en&amp;document-types%5B0%5D=case&amp;case-seat%5B0%5D=146\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">Milan<\/span><\/a><span data-contrast=\"auto\">&nbsp;commenced shortly after. The central discussion evolved around the problematic clause of the purchase agreement, which provided:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><i><span data-contrast=\"auto\">&#8220;It&#8217;s understood that if the hatchlings born alive are less than&nbsp;<\/span><\/i><i><span data-contrast=\"auto\">1.200 units<\/span><\/i><i><span data-contrast=\"auto\">.&nbsp;Caporicci&nbsp;shall pay back to Prada the amount paid in excess.&#8221;<\/span><\/i><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559685&quot;:990,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">The Parties disputed the interpretation of the article. They argued whether the figure of 1,200 units was a typographical error and was intended to be 12,000 units (Prada\u2019s position) or whether the 1,200 units was correct and reflected the true intention of the Parties (Caporicci\u2019s&nbsp;position).<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">The sole arbitrator,&nbsp;<\/span><a href=\"https:\/\/jusmundi.com\/en\/p\/andrew-g-paton\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">Andrew G. Paton<\/span><\/a><span data-contrast=\"auto\">, sided with Prada\u2019s position, relying on the fact that the advance payment was exactly USD 1,200,000, which reflects the calculation of 12,000 at a price of US$100 each.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\">Tribunal<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong><a href=\"https:\/\/jusmundi.com\/en\/p\/andrew-g-paton\" target=\"_blank\" rel=\"noopener noreferrer\">Andrew G. Paton<\/a>&nbsp;<\/strong> (Sole Arbitrator)<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><b>Tribunal Reasoning:<\/b><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">The tribunal noted that there was no regulation in place in the purchase agreement for the scenario when Caporicci produces less than 12,000 alligator hatchlings. Referring to the &#8220;<em>it&#8217;s understood that<\/em>&#8221; expression at the beginning of the article, the sole arbitrator found that by including the phrase the Parties \u201c<em>wished to agree<\/em>,\u201d that it is beyond doubt that&nbsp;Caporicci&nbsp;is required to return to Prada the excess of the <a href=\"https:\/\/jusmundi.com\/en\/search?query=%22advance%20payment%22&amp;page=1&amp;lang=en&amp;document-types%5B0%5D=case&amp;case-seat%5B0%5D=7\" target=\"_blank\" rel=\"noopener noreferrer\">advance payment<\/a>.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Restoring to the <a href=\"https:\/\/jusmundi.com\/en\/search?query=%22rules%20of%20interpretation%22&amp;page=1&amp;lang=en&amp;document-types%5B0%5D=case&amp;case-seat%5B0%5D=7\" target=\"_blank\" rel=\"noopener noreferrer\">rules of interpretation<\/a> under Italian law, the tribunal considered the overall behavior of the Parties and identified their \u201c<em>effective and real<\/em>\u201d intentions pursuant to Article 1433 of the Italian Civil Code. In doing so, the tribunal concluded that:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><span data-contrast=\"auto\">the number (1,200) specified in the agreement could not reflect the common intentions of the Parties;<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559685&quot;:990,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/li>\n\n\n\n<li><span data-contrast=\"auto\">Prada was \u201c<\/span><em>entitled to be paid back the difference with respect to the amount advanced for the purchase of Alligator eggs and<\/em><span data-contrast=\"auto\"><em>&nbsp;their rearing<\/em>.\u201d<\/span><\/li>\n<\/ol>\n\n\n\n<p class=\"wp-block-paragraph\">The tribunal ordered <span data-contrast=\"auto\">Caporicci<\/span>&nbsp;to return the payment between the contractual value of 12,000 hatchlings and 4,487 produced by <span data-contrast=\"auto\">Caporicci<\/span>.&nbsp; From that amount USD, 74,686&nbsp; (payment of the debt) and USD 43,400 (price difference of already transferred hatchlings) should be reduced.<span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Turning to the costs, the tribunal ordered Caporicci to pay all arbitration costs and awarded Prada USD 50,000 as compensation for legal fees and expenses.&nbsp;<\/span><\/p>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"text-decoration: underline;\"><a href=\"https:\/\/jusmundi.com\/en\/document\/decision\/en-nike-european-operations-netherlands-bv-v-juventus-football-club-spa-final-award-friday-1st-july-2016#decision_8792\" target=\"_blank\" rel=\"noopener noreferrer\"><b>Nike v. Juventus<\/b><\/a><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Today, Juventus, the record-holder Italian football team, partners with German sportswear giant, Adidas, as their exclusive sponsor. But it was not the case until 2014, when the relationship between Juventus and its former sponsor, Nike, deteriorated to result in adversarial arbitration proceedings.&nbsp;<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">The dispute arose as early as 2006 when Juventus got involved in the \u201cCalciopoli\u201d match-fixing scandal. As a result of the scandal, Juventus was stripped of its two winning titles, and, along with other high-profile Italian clubs, was demoted to the \u201cSerie B.\u201d <\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Consequently, Nike revised its 12-year exclusive sponsorship agreement with Juventus and decreased the sponsorship amounts by half while remaining Juventus\u2019 sponsor according to the initial sponsorship agreement until the 2014\/15 season.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Even though many high-profile footballers left the club, Juventus eventually managed to return back to&nbsp; \u201cSerie A\u201d immediately during the next, 2007-2008 season.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"alignleft\"><a href=\"https:\/\/blog.jusmundi.com\/wp-content\/uploads\/2021\/07\/2012-Juventus-Win.png\"><img decoding=\"async\" src=\"https:\/\/blog.jusmundi.com\/wp-content\/uploads\/2021\/07\/2012-Juventus-Win-300x200.png\" alt=\"2012 Juventus Win\" class=\"wp-image-272580\"\/><\/a><figcaption class=\"wp-element-caption\">Credit: Eduardo Nicolino<\/figcaption><\/figure>\n<\/div>\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">However, things escalated quickly between Nike and Juventus after the Juventus\u2019 28th \u201cScudetto\u201d win in 2012. Juventus demanded three-star shirts \u2013 symbolizing the 30th win of the team in \u201cSeries A\u201d \u2013 while Nike was refusing to recognize and include the two stripped titles into the calculation.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">In protest, Juventus decided to appear without Nike logos on their shirts, which angered the sportswear brand that claimed a breach of the exclusive sponsorship agreement.&nbsp;<\/span><\/p>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\">Arbitration<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">After unsuccessful negotiations, in 2013, Juventus announced about entering into a new sponsorship agreement with Adidas for the 2015-16 session. Nike submitted the dispute to ad hoc arbitration claiming a breach of the sponsorship agreement and asked for nearly 80 million compensation to recover its damages. In particular, Nike sought a declaration that Juventus violated confidentiality provisions by disclosing technical features of new kit before it was launched and failed to make players wear Nike jerseys during its title celebrations in 2013. &nbsp;In return, Juventus submitted a \u20ac 4 million counterclaim.&nbsp;<\/span><\/p>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Tribunal:&nbsp;<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/jusmundi.com\/en\/p\/alexis-mourre\" target=\"_blank\" rel=\"noopener noreferrer\"><b><span data-contrast=\"none\">Alexis Moore<\/span><\/b><\/a><b><span data-contrast=\"none\">&nbsp;<\/span><\/b><span data-contrast=\"none\">(Chair)<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/li>\n\n\n\n<li><a href=\"https:\/\/jusmundi.com\/en\/p\/massimo-benedettelli\" target=\"_blank\" rel=\"noopener noreferrer\"><b><span data-contrast=\"none\">Massimo V.&nbsp;Benedettelli<\/span><\/b><\/a><b><span data-contrast=\"auto\">&nbsp;<\/span><\/b><span data-contrast=\"auto\">(Appointed by the Claimant)<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/li>\n\n\n\n<li><a href=\"https:\/\/jusmundi.com\/en\/p\/paolo-montalenti\" target=\"_blank\" rel=\"noopener noreferrer\"><b><span data-contrast=\"none\">Paolo&nbsp;Montalenti<\/span><\/b><\/a><b><span data-contrast=\"auto\">&nbsp;<\/span><\/b><span data-contrast=\"auto\">(Appointed by the Respondent)<\/span><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Chaired by Alexis Moore, the former president of ICC, the three-member tribunal seated in <a rel=\"noopener noreferrer\" href=\"https:\/\/jusmundi.com\/en\/search?query=%22burden%20of%20proof%22&amp;page=1&amp;lang=en&amp;document-types%5B0%5D=case&amp;case-seat%5B0%5D=4\" target=\"_blank\">Geneva<\/a> rejected the counterclaim and sided with Nike to compensate the sportswear brand for the breach of the sponsorship agreement.<span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Tribunal Reasoning:<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">The tribunal considered the conduct of Juventus from 2011 onwards and found that Juventus\u2019 breached the duty of <a href=\"https:\/\/jusmundi.com\/en\/search?query=%22duty%20of%20good%20faith%22&amp;page=1&amp;lang=en&amp;document-types%5B0%5D=case\" target=\"_blank\" rel=\"noopener noreferrer\">good faith<\/a> and <a href=\"https:\/\/jusmundi.com\/en\/search?query=%22duty%20of%20confidentiality%22&amp;page=1&amp;lang=en&amp;document-types%5B0%5D=case\" target=\"_blank\" rel=\"noopener noreferrer\">confidentiality<\/a>.&nbsp; The tribunal reasoned that losses suffered were the result of the breach by Juventus while concluding that the breaches only occurred during the preceding two years. According to the tribunal, the attempt to recover base compensation and compensation for loss of brand exposure was duplicative. Nike had received most of the value expected in terms of brand exposure by that time.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">For these reasons, the tribunal only awarded Nike \u20ac1.5 million \u2013 equivalent to five percent of base compensation over a two-year period and ordered Juventus to compensate the arbitration expenses in the amount of \u20ac550,000.&nbsp;<\/span><\/p>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span style=\"text-decoration: underline;\"><a href=\"https:\/\/jusmundi.com\/en\/document\/decision\/en-hans-juergen-benze-v-antiquorum-usa-inc-final-award-wednesday-8th-january-2014\" target=\"_blank\" rel=\"noopener noreferrer\"><b>Hans-Juergen Benze v. Antiquorum USA<\/b><\/a><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Buying a Rolex watch at an auction can turn into a nightmare. Don\u2019t believe that? So did Hans-Juergen Benze when purchasing the US$ 168,000 &#8220;Paul Newman&#8221; Rolex watch (Watch) at an auction in 2008.<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">After 2,5 years from the purchase, to preserve its movement fluidity, Hans-Juergen&nbsp;Benze&nbsp;brought the Watch for movement servicing at the Rolex service center. Six months later, Rolex returned the&nbsp; Watch with a letter refusing to service the Watch due to \u201c<\/span><i><span data-contrast=\"auto\">a question regarding the Watch dial\u2019s authenticity.<\/span><\/i><span data-contrast=\"auto\">\u201d As if that was not enough, Rolex had placed an &#8220;&#8221;&#8221; mark on the inside of the back of the Watch, purportedly to indicate to other service centers that the Watch dial was believed by Rolex to be \u201cinauthentic.\u201d<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"alignleft\"><a href=\"https:\/\/blog.jusmundi.com\/wp-content\/uploads\/2021\/07\/RPR_CATALOGONEWMAN.jpeg\"><img decoding=\"async\" width=\"210\" height=\"300\" src=\"https:\/\/blog.jusmundi.com\/wp-content\/uploads\/2021\/07\/RPR_CATALOGONEWMAN-210x300.jpeg\" alt=\"Paul Newman Rolex\" class=\"wp-image-272579\" srcset=\"https:\/\/daily.jusconnect.com\/~www\/wp-content\/uploads\/2021\/07\/RPR_CATALOGONEWMAN-210x300.jpeg 210w, https:\/\/daily.jusconnect.com\/~www\/wp-content\/uploads\/2021\/07\/RPR_CATALOGONEWMAN-716x1024.jpeg 716w, https:\/\/daily.jusconnect.com\/~www\/wp-content\/uploads\/2021\/07\/RPR_CATALOGONEWMAN-768x1099.jpeg 768w, https:\/\/daily.jusconnect.com\/~www\/wp-content\/uploads\/2021\/07\/RPR_CATALOGONEWMAN.jpeg 1000w\" sizes=\"(max-width: 210px) 100vw, 210px\" \/><\/a><figcaption class=\"wp-element-caption\">Extract from a catalog from the 1960s showing different versions of Paul Newman Daytona watches with exotic dials.<\/figcaption><\/figure>\n<\/div>\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Concerned about the situation he found himself in, Hans-Juergen Benze reported the watch to be counterfeit to the auction house, asking for the full refund in the amount of USD 168,000. The auction house, Antiquorum USA, refused to refund, stating that the Watch was no longer in the original condition due to the added&nbsp; &#8220;&#8221;&#8221; mark.&nbsp;<\/span><\/p>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h4 class=\"wp-block-heading\"><b>Arbitration<\/b><\/h4>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Unable to get compensation, Mr.&nbsp;Benze&nbsp;(Claimant) submitted the dispute to arbitration under&nbsp;<\/span><a href=\"https:\/\/jusmundi.com\/en\/document\/rules\/en-aaa-american-arbitration-association-commercial-arbitration-rules-and-mediation-procedures-including-procedures-for-large-complex-commercial-disputes-2009-aaa-commercial-arbitration-rules-2009-monday-1st-june-2009?su=%2Fen%2Fsearch%3Fquery%3DAAA%2520Commercial%2520Arbitration%2520Rules%26page%3D1%26lang%3Den%26document-types%5B0%5D%3Drules\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">AAA Commercial Arbitration Rules<\/span><\/a><span data-contrast=\"auto\">, asserting against Antiquorum USA (Respondent) a \u201c<\/span><i><span data-contrast=\"auto\">cause of action for breach of contract\/breach of the warranties contained in the Conditions of Sale, on the ground that the Watch he purchased from Respondent at the Auction is a counterfeit because its dial is allegedly not authentic.<\/span><\/i><span data-contrast=\"auto\">\u201d&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">Among others, the Claimant submitted that the Watch was an &#8220;intentional forgery,&#8221; and the Respondent failed to disclose that the Watch contained a forged or replaced dial. The catalog relied on by the Claimant, falsely claimed that the&nbsp;<\/span><i><span data-contrast=\"auto\">\u201c[<\/span><\/i><span data-contrast=\"auto\">W<\/span><i><span data-contrast=\"auto\">atch] dial was in perfect condition\u201d <\/span><\/i><span data-contrast=\"auto\">and that<\/span><i><span data-contrast=\"auto\">&nbsp;\u201cthe Watch as a whole was in exceptional condition.\u201d<\/span><\/i><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">In defense, the Respondent referred to the Conditions of Sale and denied all the allegations. Respondent\u2019s&nbsp; main assertions could be summarized as follows:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><i><span data-contrast=\"auto\">The provisions of the Conditions of Sale did not guarantee that the Watch dial, being a component part of the Watch, was original to the Watch;<\/span><\/i><\/li>\n\n\n\n<li><i><span data-contrast=\"auto\">The provisions of the Conditions of Sale warranting that the Watch is not an &#8220;intentional forgery&#8221; apply to the Watch, as a whole, and not specifically to the Watch dial;<\/span><\/i><\/li>\n\n\n\n<li><i><span data-contrast=\"auto\">The responsibility to examine the Watch prior to its purchase was placed on the Claimant, as a purchaser; Claimant agreed to accept the Watch &#8220;as [was]&#8221; <\/span><\/i>at the time of purchase, without regard to any description in the Catalogue or otherwise.<\/li>\n\n\n\n<li><i><span data-contrast=\"auto\">Respondent\u2019s Limited Warranty contained in the Conditions of Sale guarantees related to the general description, it did not contain any statements alleged by Claimant in this arbitration to be untrue or inaccurate.<\/span><\/i><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559685&quot;:1170,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/li>\n\n\n\n<li><i><span data-contrast=\"auto\">The Conditions of Sale preclude any recovery by Claimant because the Claimant did not comply with the obligation to return the Watch to Respondent immediately upon the discovery of any basis for such claim in the same condition in which it was purchased.<\/span><\/i><\/li>\n<\/ol>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\">Tribunal<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/jusmundi.com\/en\/p\/martin-s-tackel\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\"><strong>Martin S. Tackel<\/strong><\/span><\/a> (Sole Arbitrator)<\/li>\n<\/ul>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h3 class=\"wp-block-heading\"><b>Tribunal Reasoning:<\/b><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">In an arbitration seated in <a href=\"https:\/\/jusmundi.com\/en\/search?query=%22burden%20of%20proof%22&amp;page=1&amp;lang=en&amp;document-types%5B0%5D=case&amp;case-seat%5B0%5D=7\" target=\"_blank\" rel=\"noopener noreferrer\">New York<\/a>, the sole arbitrator, <a href=\"https:\/\/jusmundi.com\/en\/p\/martin-s-tackel\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">Martin S. Tackel<\/span><\/a><span data-contrast=\"auto\">, considered expert witness reports, heard 7 testimonies, including the Claimant\u2019s own expository oral testimony, and separated two principal issues to be dealt with:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><i><span data-contrast=\"auto\">whether the Rolex contained a counterfeit dial or was otherwise inauthentic at the time of sale; and<\/span><\/i><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559685&quot;:1170,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/li>\n\n\n\n<li><i><span data-contrast=\"auto\">whether Claimant is entitled to a remedy herein against Respondent or, on the contrary, would any such remedy be barred by the provisions of the Conditions of Sale?<\/span><\/i><\/li>\n<\/ol>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"auto\">As a result, the tribunal remained unconvinced by the Claimant\u2019s submitted evidence (expert witness report, the Rolex official letter, and oral testimonies) and found that the Claimant \u201c<\/span><i><span data-contrast=\"auto\">has not met the <a href=\"https:\/\/jusmundi.com\/en\/search?query=%22burden%20of%20proof%22&amp;page=1&amp;lang=en&amp;document-types%5B0%5D=case&amp;case-types%5B0%5D=6\" target=\"_blank\" rel=\"noopener noreferrer\">burden of proof<\/a> by a <a href=\"https:\/\/jusmundi.com\/en\/search?query=%22preponderance%20of%20the%20evidence%22&amp;page=1&amp;lang=en&amp;document-types%5B0%5D=case\" target=\"_blank\" rel=\"noopener noreferrer\">preponderance of the evidence<\/a> to prove a breach of any contract or any warranty, representation,&nbsp;<\/span><\/i><i><span data-contrast=\"none\">or guaranty given to, Claimant<\/span><\/i><span data-contrast=\"none\">.\u201d<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"none\">In doing so, the tribunal pointed out that the Rolex letter provided by the Claimant was not \u201c<\/span><i><span data-contrast=\"none\">adequately nor otherwise authenticated and was otherwise without foundation proper to this proceedings<\/span><\/i><span data-contrast=\"none\">.\u201d&nbsp;<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"none\">Turning to the&nbsp; expert witness testimony the Claimant relied upon, the tribunal found that it \u201c<\/span><i><span data-contrast=\"none\">lacked meaningful credibility, and was of limited probative value.<\/span><\/i><span data-contrast=\"none\">\u201d To substantiate the latter, the tribunal pointed out the contradictory statements made by the expert in his report and during the examination. Additionally, the cross-examination revealed that the purported statement that Mr. Faber inspected the insides of dozens of \u201cPaul Newman\u201d watches, in fact, appeared to be false.<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"none\">Addressing the second issue, the tribunal reasoned that even if the Claimant prevailed on the inauthenticity claim, the provisions of the conditions of sale, including those of the <a href=\"https:\/\/jusmundi.com\/en\/search?query=%22limited%20warranty%22&amp;page=1&amp;lang=en&amp;document-types%5B0%5D=case&amp;case-seat%5B0%5D=7\" target=\"_blank\" rel=\"noopener noreferrer\">limited warranty<\/a>, would bar any recovery by the Claimant.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"none\">Turning to costs, the tribunal ordered the arbitration costs to be borne as incurred by the Parties and divided arbitrator compensation in the amount of USD 19,245 equally between the Claimant and the Respondent.<\/span><\/p>\n\n\n\n<div style=\"height:30px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"none\">We hope you have enjoyed this series of analyses of fashion industry disputes. If you would like more articles and insights like this or to continue the conversation, we\u2019d love to hear from you.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span data-contrast=\"none\">Jus Mundi offers a comprehensive database of full commercial arbitration awards <\/span><span data-contrast=\"none\">and exclusive content&nbsp;<\/span><span data-contrast=\"none\">from our partnerships with&nbsp;<\/span><a href=\"https:\/\/jusmundi.com\/en\/partnership\/icc\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">International Chamber of Commerce<\/span><\/a><span data-contrast=\"none\">&nbsp;&amp;&nbsp;<\/span><a href=\"https:\/\/jusmundi.com\/en\/partnership\/iba\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">International Bar Association<\/span><\/a><span data-contrast=\"none\">&nbsp;with a possibility of a&nbsp;<\/span><a href=\"https:\/\/jusmundi.com\/en\/register\/regist\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">free trial.<\/span><\/a><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335551550&quot;:6,&quot;335551620&quot;:6,&quot;335559740&quot;:276}\">&nbsp;<\/span><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"https:\/\/jusmundi.com\/en\/coverage\/commercial-arbitration\" target=\"_blank\" rel=\"noopener noreferrer\"><span data-contrast=\"none\">Click here t<\/span><span data-contrast=\"none\">o learn more about our commercial arbitration coverage.<\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>At Jus Mundi, we decided to take up the challenge and examine the involvement of the top fashion &#038; sports brands in arbitrations by looking into our comprehensive dataset of commercial arbitration awards.<\/p>\n","protected":false},"author":4,"featured_media":278550,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":{"subtitle":"","format":"standard","video":"","gallery":"","source_name":"","source_url":"","via_name":"","via_url":"","override_template":"0","override":[{"template":"custom","single_blog_custom":"274736","parallax":"1","fullscreen":"1","layout":"right-sidebar","sidebar":"author","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"hide","share_float_style":"share-monocrhome","show_share_counter":"0","show_view_counter":"0","show_featured":"1","show_post_meta":"1","show_post_author":"0","show_post_author_image":"0","show_post_date":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_category":"0","show_post_reading_time":"0","post_reading_time_wpm":"300","show_zoom_button":"0","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"0","show_prev_next_post":"0","show_popup_post":"0","number_popup_post":"1","show_author_box":"0","show_post_related":"0","show_inline_post_related":"0"}],"override_image_size":"0","image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post":"0","trending_post_position":"meta","trending_post_label":"Trending","sponsored_post":"0","sponsored_post_label":"Sponsored by","sponsored_post_name":"","sponsored_post_url":"","sponsored_post_logo_enable":"0","sponsored_post_logo":"","sponsored_post_desc":"","disable_ad":"0"},"jnews_primary_category":{"id":"207","hide":""},"jnews_social_meta":{"fb_title":"","fb_description":"At Jus Mundi, we decided to take up the challenge and examine the involvement of the top fashion & sports brands in arbitrations by looking into our comprehensive dataset of commercial arbitration awards.","fb_image":"278550","twitter_title":"","twitter_description":"","twitter_image":""},"jnews_review":[],"enable_review":"0","type":"percentage","name":"","summary":"","brand":"","sku":"","good":[{"good_text":""}],"bad":[{"bad_text":""}],"score_override":"0","override_value":"","rating":[{"rating_text":"","rating_number":"10"}],"price":[{"shop":"","price":"","link":"","icon":""}],"jnews_override_counter":{"override_view_counter":"0","view_counter_number":"0","override_share_counter":"0","share_counter_number":"0","override_like_counter":"0","like_counter_number":"0","override_dislike_counter":"0","dislike_counter_number":"0"},"footnotes":""},"categories":[205,207,188],"tags":[],"coauthors":[],"class_list":["post-272573","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-arbitration","category-commercial-arbitration","category-legal-insights"],"_links":{"self":[{"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/posts\/272573","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/comments?post=272573"}],"version-history":[{"count":3,"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/posts\/272573\/revisions"}],"predecessor-version":[{"id":278227,"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/posts\/272573\/revisions\/278227"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/media\/278550"}],"wp:attachment":[{"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/media?parent=272573"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/categories?post=272573"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/tags?post=272573"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/dailyjus.com\/index.php\/wp-json\/wp\/v2\/coauthors?post=272573"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}