Whose Brand Is It, Anyway?

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Win or lose, Williamson says she has learned things that will make her a better businessperson in the future. She believes, for example, that working on the case has greatly enhanced her ability to think strategically, to look four or five moves ahead before making a decision. And yet, she can't deny that the J.Lo episode has done nothing good for her business. Her old customers, including the celebrities, have remained loyal, showing their support by increasing their purchases, but overall, holiday sales were down from the previous year. Nordstrom still hasn't decided whether to carry Glow in any more of its stores, and Williamson still hasn't heard anything from the other department stores she'd been talking to before Glow by J.Lo came along. Up to then, Glow had been growing even faster than she'd hoped back in 1999, when she'd dreamed of building a $30 million business within 10 years. Now, her annual sales seem stuck at less than $2 million, and although she has recently come up with a new scent, fig, she says she has had to cut back on the time she spends developing products and working with retail partners. There are, after all, only so many hours in a day.

But that's a sacrifice Williamson believes she has to make. "I went through a period of thinking, 'I'm not built for this, I don't want to do this," she says. "But then I realized that walking away from the lawsuit would be the worst disservice I could do to my company. I have to give as much to my attorney as he needs to win the case. It's a test of whether I'm willing to stand up for my brand."

Her time is not the only cost of pursuing the case. "There's also the stress associated with this sort of litigation, which is enormous," notes Yale Lewis. "She's doing admirably so far, from what I can see." In addition, Williamson has out-of-pocket litigation costs she has to cover -- for copying discovery documents, transcribing depositions, travel, hiring experts, and so on. Those expenses could run into tens of thousands of dollars before the case is decided. And, of course, there are the legal fees. "For something like this, they could easily exceed $1 million," Lewis says. Both he and Williamson decline to discuss their financial arrangement, but it is common in such situations for a lawyer to be paid at least in part on a contingency basis.

The corollary, of course, is that neither the plaintiff nor the attorney are likely to go forward unless they believe they have a good shot at winning. Lewis says he does, in fact, consider the case to be strong. If the final verdict is that Lopez, Coty, and Sweetface have infringed on Williamson's trademark, they would have to pay damages to Glow Industries. Included in those damages could be the profit Glow Industries has lost, plus all or most of the defendant's profit on Glow by J.Lo. In addition, there might be punitive damages -- possibly triple damages -- as well as reimbursement of litigation costs and legal fees.

While Williamson could walk away with a bundle of money, she has insisted from the very beginning that the case isn't about money -- that all she really wants is to get back her company's name so that she can finish building the brand she started in February 1999. But that may no longer be realistic. "Right after Christmas, when I had time to sit down and think, I really saw how difficult it would be to keep the name Glow under any circumstances," she says. "They could stop using it today, and Glow would still be linked with J.Lo. We may never get into some stores for that reason alone. Will Macy's East take our products if it's still carrying J.Lo's fragrance under another name? The problem is that the damage has been done. Even if I win the case, I might have to change the name."

But then, wouldn't she be better off making the change sooner rather than later? If Lopez, Coty, and Sweetface were to offer a settlement, shouldn't she take the money and move on? "I really haven't even considered the possibility," she says, "because it hasn't been presented to me." Shouldn't she think about going forward anyway? Isn't she going to look back after the trial, when she starts the long, hard process of rebranding, and think, "Why didn't I do this sooner?"

Williamson demurs. "Rebranding is a very expensive process," she says. "It's not just a matter of changing a name. I regard it as a whole other job. Yes, I've thought about how I might do it, but I can't even consider starting on it right now. I don't have the resources in terms of time or money."

The House of Jennifer Lopez

By contrast, the denial of the motion lifted a huge burden from the shoulders of all the people associated with Glow by J.Lo and allowed them to enjoy what they'd accomplished. In early January 2003, industry observers were estimating that sales of the fragrance had totaled $44 million in its first four months. (Sweetface and Lancaster say that estimate was low.) Whatever the actual number, Coty CEO Bernd Beetz told Women's Wear Daily that he knew of only four other fragrances in history that had rung up sales of more than $40 million in their first four months: "We think we're well on the way to $100 million" in the first year.

Catherine Walsh, for her part, was already moving on. From the beginning, her vision had been to build what she called "the House of Jennifer Lopez," a full line of cosmetics and fragrances that reflected her many audiences and the many facets of her personality. One audience was the Gen-Y, urban-oriented, hip-hop-loving 15- to-21-year-old girls who identified with "Jenny from the Block." Glow by J.Lo was directed squarely at them. But there was also the Jennifer Lopez in the Versace peek-a-boo dress at the Grammy Awards, and the stunning white Valentino bridal gown at her most recent wedding -- to Cris Judd, the guy she was with before Ben Affleck. That Jennifer Lopez appealed to a more sophisticated and mature audience, Walsh believed, and there should be a fragrance for them as well.

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Bo Burlingham

Burlingham joined Inc. in 1983. An editor at large, he is the author of Small Giants: Companies That Choose to Be Great Instead of Big. The book was a finalist for the Financial Times/Goldman Sachs Business Book of the Year Award in 2006. Burlingham is also the co-author with Norm Brodsky of The Knack; and the co-author with Jack Stack of The Great Game of Business and A Stake in the Outcome.

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