Wet Seal Throws Wet Blanket Over Former Exec
Foothill Ranch, Calif.–based specialty retail chain The Wet Seal Inc. won round one of its legal battle with Gregory Scott, the former president of the company’s Arden B. division.
The Orange County Superior Court granted Wet Seal a temporary restraining order on Feb. 26 that bars Scott, now the chief executive of Bebe Stores Inc., from soliciting current Wet Seal personnel for employment and from disclosing trade secrets obtained through his former employer.
The restraining order will be in effect until at least March 26, when the court is scheduled to hear arguments pertaining to the lawsuit that Wet Seal filed on Feb. 23 against Scott and Bebe.
Wet Seal charged that Scott violated the non-compete and non-solicitation terms of his contract by jumping ship to join Bebe on Feb. 17. The suit also alleges that Scott and Bebe inappropriately solicited current Wet Seal workers for employment.
In a statement, a Bebe spokesperson said: “Although the court granted a short-term order prohibiting Mr. Scott from soliciting employees of the Wet Seal or using its trade secrets, there was no finding that Mr. Scott had ever done so.hellip; Bebe reiterates that it believes that its actions have been lawful, and it will continue to defend itself vigorously.”
Scott has been credited with growing Arden B. into one of Wet Seal’s strongest units. The 99-unit chain carries contemporary apparel for young women and competes directly with Bebe, which has 187 units in its chain. Bebe, based in Brisbane, Calif., also maintains offices in Los Angeles, where its chairman and founder, Manny Mashouf, is based. —Robert McAllister
