Von Dutch Settlement Reached

The two-year struggle over the ownership of the $33 million Von Dutch Originals brand has been resolved. On Feb. 6, Von Dutch Chief Executive Officer Tonny Sorensen reached an out-of-court settlement with former Von Dutch President Michael Cassel for an undisclosed amount, according to a Von Dutch spokesperson.

“I am happy to have put the past behind us,” Sorensen said. “We now look to the bright future of our company that promises to be filled with more innovations in fashion as we continue to set trends in the industry.”

Cassel declined to comment at press time.

Von Dutch’s sales skyrocketed from $6 million in 2002 to more than $33 million in 2003. With a stable of retail stores and new product categories—including lingerie, swimwear and footwear—entering the line, the company is projecting sales will reach more than $150 million next year.

Currently, Von Dutch operates three retail boutiques, two on Melrose Avenue in Los Angeles and one on the Third Street Promenade in Santa Monica, Calif. Additionally, the 7-year-old company has partnerships with retail store franchises in Beverly Hills, Chicago, Miami and Las Vegas.

Von Dutch Originals makes T-shirts, jeans, jackets and tank tops that retail from $50 to $145. Celebrities including Fred Durst, Paris Hilton and Britney Spears—who reportedly wore a Von Dutch baseball cap during her impromptu wedding ceremony last month in Las Vegas—have helped perpetuate the brand’s popularity.

Von Dutch is the pseudonym of the late Kenny Howard, a car detailer who created a counterculture among automotive enthusiasts in the 1950s with his dark, unusual artwork.

Von Dutch’s wholesale operation originated in 1996, when Howard’s daughters, Lisa and Lorna, sold the trademark to Cassel. In 1998, Cassel formed a partnership with Sorensen. In the fall of 2002, Cassel initiated litigation against Sorensen, charging that Sorensen had misrepresented an investor’s agreement and illegally claimed all the rights to Von Dutch.

A separate lawsuit filed in June 2003 claimed that Cassel, Sorensen and Von Dutch LLC, the parent company of Von Dutch Originals, had defrauded and unfairly competed with apparel maker Robert Vaughn, who cofounded the company in 1996.

On Feb. 2, the court ordered Von Dutch to produce all its financial records, including those of the past five years. The court then instructed the company to pay a sanction of $2,000 to Vaughn for failing to produce documents requested during the discovery, according to Vaughn’s attorney, Steven T. Lowe, of Lowe Law in Los Angeles.

The case will go to trial at Los Angeles Superior Court in July 2004. —C.F.