At the point of sale, a buyer will want to ensure these essential elements are captured in the transaction, whereas a founder (particularly in the event of a partial exit) will likely seek protections to preserve brand identity and continued influence. Ensuring clarity among the relevant parties regarding their ongoing respective rights, and the precise assets being transferred in the sale of a founder‑led beauty brand is therefore essential.
The current claims brought by Estée Lauder against Jo Malone (personally), Jo Loves Limited, Jo Loves (Wholesale) and Zara (ITX UK) illustrate the complexities and limitations which can arise for a founder following the sale of an eponymous brand, where the boundary can often be blurred between personal attribution, founder descriptions and the commercial use of a name.
Jo Malone London was purchased by Estée Lauder in 1999, in an agreement that included restrictions on Malone’s ability to use her name in certain commercial contexts, including the marketing of fragrances. Malone remained at Jo Malone London as creative director until 2006, and established a new fragrance company, Jo Loves, in 2011 after her non-compete expired.
Estée Lauder’s current claims focus on the wording “A creation by Jo Malone CBE” that features on perfume bottles and packaging that form part of a collaboration between Jo Loves and Zara. The claims consist of the following:
Malone has since publicly asserted that she “sold a company, not [herself]” and has proceeded with defending the claims, alongside Zara. While the outcome of this case is awaited, it demonstrates the intertwined tensions between personal identity and legally protectable branding.
Malone is not the only founder of a brand acquired by Estée Lauder to go on to create a new company operating in the same field as their original company. A comparison of Jo Loves and Jones Road shows a lower-risk approach: building a new brand identity that does not depend on the founder’s name, and strictly limits references to the founder to factual background rather than product presentation.
Jones Road is a beauty brand founded by Bobbi Brown in 2020, after the expiry of her 25-year non-compete following her exit from Bobbi Brown Cosmetics, which Estée Lauder purchased in 1995. The original acquisition agreement between Estée Lauder and Bobbi Brown included similar restrictions to those included in Malone’s, limiting Brown’s ability to use her name for commercial purposes going forward.
But, unlike Jo Loves, Jones Road does not make any reference to ‘Bobbi Brown’ or even ‘Bobbi’ in any branding, marketing or packaging. The only mention of the full name is in an explanatory note on the Jones Road website, stating that Brown founded the company. The reference has not been challenged by Estée Lauder.
It is therefore crucial to consider how the use of a name that has contractual and/or intellectual property protection may be interpreted as forming part of how a product is presented and marketed. Particularly in the context of an eponymous brand, distinguishing between “personal” and “commercial” use is essential (although difficult in practice when running a business). Context is key.
The buyer’s position is also not entirely risk-free. Where a buyer may specifically acquire intellectual property owned by a company (including trade marks and goodwill), European case law suggests that the way a founder-name mark is used after the founder’s departure may still matter, particularly if marketing creates the impression that the founder remains creatively involved.
In PMJC SAS v Jean-Charles de Castelbajac (Case C‑168/24) (read more here), the CJEU considered how trade marks consisting of an individual’s name can be misleading under EU law. It found that creative origin, in addition to nature, quality or geographic origin, should be considered in sectors where there is key creative input. In particular, infringement by the company of the departed founder and designer’s copyright was a key determining factor in finding that the founder name trade marks had become misleading.
Thus, under EU law, it may constitute misleading use of a trade mark, where such use leads consumers to believe a particular individual is designing a product when they are not, where the designer’s identity is a key factor influencing consumer choice. Again, context is key.
While it confirmed that it is entirely possible for trade marks consisting of a founder’s name to remain valid and irrevocable after that founder has left the company, the decision highlights the importance of assessing how products are marketed following the departure of a founder from an eponymous company, and to consider the context of the broader company activities. Appropriate branding adjustments may be needed to avoid giving consumers the impression that the individual is still creatively involved.
This decision also provides exiting founders, subject to restrictions in respect of the commercial use of their name, some leverage to protect their personal brand in an EU context.
Where possible, appropriate protections should be included in the deal terms to allow founders to retain a level of control in their brand following a partial sale. The value of preserving such an interest was recently demonstrated by Charlotte Tilbury MBE who founded beauty phenomenon Charlotte Tilbury in 2013 but later sold a majority shareholding in Charlotte Tilbury Limited to Spanish fashion and beauty conglomerate, Puig.
The 2020 deal between Tilbury and Puig, renewed in 2024, involves staged founder economics, leaving Tilbury with a minority shareholding in the beauty company (but retaining her positions as chairman, president and chief creative officer) with Puig progressively assuming full ownership up to 2031.
This deal has so far proved to be hugely successful for Puig, with Charlotte Tilbury tripling its profits from 2020 to 2024. However, it has also had unexpected longer-term consequences relating to the merger discussions that commenced last year between Puig and Estée Lauder, which could have resulted in a premium beauty giant.
The recent collapse of these talks has been partly attributed to a change-of-control clause included the Charlotte Tilbury deal with Puig, which allows Tilbury to crystallise her remaining minority shareholding should the ownership of Puig change hands. Estée Lauder was not willing for this cost (estimated at around €900 million) to be integrated into the transaction economics with Puig.
Ironically, it is the success of the Charlotte Tilbury Limited acquisition that has undermined Puig’s broader ambitions. The structure of the deal has ensured Tilbury remains at the heart of the company and continues to provide both the legacy and resources to grow the brand further. However, perhaps if the company had performed slightly less impressively since the initial acquisition, the change-of-control clause may not have had the power to sink the merger between Puig and Estée Lauder.
This demonstrates how contractual protections can assist founders to retain an element of influence, and preserve personal value, in their brands. That being said, if Puig does assume full ownership of Charlotte Tilbury, it is likely that Tilbury will be subject to similar restrictions as those imposed on Malone and Brown in respect of the commercial use of her name.
