The Donald triumphs at trial over clothing royalties

Judge rules evidence presented by licensing company insufficient

Donald Trump
Donald Trump

A New York State Supreme Court Judge has ruled in favor of real estate mogul Donald Trump in a case centered on royalties for the Donald J. Trump Signature Collection, the real estate honcho’s luxury line of shirts and ties, a spokesperson for Trump told The Real Deal today.

Judge Eileen Bransten granted Trump a directed verdict in the case today, dismissing claims against him from New York City-based licensing firm ALM Unlimited, which said it helped him secure a licensing deal for his line in 2003. ALM alleged that Trump improperly stopped paying the company a cut of the royalties in 2008, breaching a contract he inked with Trump five years before.

By issuing a directed verdict, the judge sidestepped the jury, which had listened to seven days of testimony on the case, including from Trump himself. The judge said there was simply not sufficient evidence to establish the existence of a valid contract between Trump and ALM to continue with litigation, according to Trump’s spokesperson. The jury has been released from its responsibilities.

Trump told the jury last week that ALM had only a small role in arranging his 2004 deal with apparel giant PVH, formerly known as Phillips-Van Heusen. The line brought in more than $3.2 million in royalties between 2005 and 2007, according to ALM. More credit for the deal was due to television host Regis Philbin, who introduced him to PVH, Trump said.

The mogul was “extremely pleased” with the outcome of the case and happy it had gone to trial, Alan Garten, executive vice president and litigation counsel to the Trump Organization, said in a statement to The Real Deal.

“[We] will not hesitate to take a case to trial to stand up for what we believe is right,” he said.

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Trump’s attorney Jeffrey Goldman said the decision “should be a warning to all those who see Mr. Trump as a high profile wealthy target for litigation.”

The ruling brings an end to four years of litigation between Trump and ALM.

Jay Itkowitz, an attorney for licensing company, said he was “very disappointed” with the decision, which he called “completely erroneous.”

“It would not withstand an appellate review,” he said.

The judge’s decision to offer a directed verdict, rather than override the jury’s decision, means that a successful appeal would require a retrial and more court time, making it more of a financial investment for ALM to appeal the decision. The company could still get a small benefit if the judge rules in its favor on one outstanding claim, Itkowitz said.

It was not clear if ALM would appeal the decision.