Kim, Khloe and Kourtney have been engaged in a legal battle with Haven Beauty and Hillair Capital since 2016. The dispute stems from a five-year licensing deal the sisters reached in 2012 with the now defunct Boldface Licensing + Branding, which caused financial problems in the next year and this led to Hillair buying its assets – including its license rights – and forming Haven to own them.
As part of the original agreement, the Kardashians allowed the use of their marks, images and likenesses for the line, provided all uses were approved in writing in advance. In return, they would receive an advance of $ 1 million and royalties on sales of Kardashian Beauty products. (The line was originally dubbed Khroma Beauty, but this led to a separate brand fight and eventually the name was changed.) As of February 2016, they had not received any royalties. They informed Hillair that he was in violation of the agreement, and the legal battle ensued. Hillair argued that the Kardashians were the ones who broke the deal by not promoting the cosmetics line.
The dispute went to arbitration, where a panel sided with the Kardashians following a nine-day hearing in early 2018. Hillair challenged the award, but the Superior Court judge from LA County Richard L. Fruin sided with the sisters and handed down an estimated $ 11.5 million judgment in their favor.
On the case’s second trip to an appeals court – the first being when Hillair attempted and failed in federal court to overturn an injunction that prevented her from using the Kardashian Beauty name – the famous family took to the court. again won the victory.
Hillair challenged the order compelling the arbitration and the order upholding the arbitration award. California’s Second Appeals District ruled on Tuesday that a contract between the parties required arbitration, and the arbitrator appropriately decided that arbitration was the correct forum for the dispute. He also ruled that California precedent limits the situations in which an arbitration award can be set aside and, with few exceptions, they cannot be reviewed for errors of fact or law. (Although the panel made no findings of error here.)
“Some federal courts will find that an arbitrator has exceeded his authority when the arbitration award demonstrates clear disregard for the law,” states the opinion, which is incorporated below. “The appellants ask that we apply this standard. But case law establishes that an “arbitrator [alleged] overt disregard for the law is not grounds for vacancy under California law. ‘ … When California courts refrain from reviewing arbitral awards for errors of law, it logically leads to upholding those awards out of deference. A rule that leads to the confirmation of arbitral awards helps enforce arbitration agreements. There is no basis for finding preemption.
In addition to the $ 11.5 million already awarded to them, the sisters will be able to recover their costs on appeal – plus at least $ 2 million in post-judgment interest.
In a statement to Hollywood journalist, Kardashians lawyer Michael Kump of Kinsella Weitzmen Iser Kump Holley praised his clients’ victory.
“Kim, Khloe and Kourtney are thrilled with this important victory in the California Court of Appeals,” Kump said. “It’s been a long road since 2012 when they signed the licensing agreement authorizing the use of their names and likenesses in the sale of color cosmetics. In order to get what they were promised, they were forced to litigate in state and federal courts, and in JAMS arbitration – winning every step of the way. They deserve to be paid what is owed to them.