APPEALS COURT UPHOLDS JLM COUTURE IN CONTRACT DISPUTE WITH HAYLEY PAIGE GUTMAN

Rhea-AI Summary

The Second Circuit Court of Appeals confirmed that JLM Couture did not breach its employment contract with Hayley Paige Gutman and is not obligated to provide additional compensation. The court ruled that Gutman resigned, violating her contract, and upheld JLM's enforcement of a noncompete clause, deeming it reasonable considering her unique role. Additionally, the court did not address the ownership of Gutman's Instagram account, sending this matter back to the District Court for proper resolution. This decision highlights JLM's rights concerning its brand and contractual agreements.

Positive

• Court affirmed JLM's enforcement of a noncompete clause, enhancing company control over brand management.
• Decision supports JLM's legal standing in contract enforcement, reinforcing shareholder confidence.

Negative

• None.

NEW YORK, Jan. 25, 2022 /PRNewswire/ -- The Second Circuit Court of Appeals today strongly affirmed that Hayley Paige Gutman breached her clear and unambiguous employment contract and is not entitled to any additional compensation. The court stated that "JLM had no duty to pay Gutman if she did not work." It was Ms. Gutman who resigned and who breached her employment contract, not JLM, the Appeals Court ruled.

The Appeals Court also affirmed that JLM was completely within its rights to enforce a noncompete clause in the employment contract. The Court stated that, "Gutman provides no reason to question the district court's determination that this Noncompete Agreement was reasonable and fully enforceable in light of her unique role at JLM." They also stated that the District Court was correct in upholding JLM's rights to the brand name and marks in trade and commerce, and "decline(d) Gutman's invitation to depart from the plain language of the Contract."

In addition, the Court in no way ordered the Instagram account to change hands nor did they determine ownership of the account. They expressly declined to do so. They remanded this issue back down to the District Court as that is the proper procedure.

"[Ms.] Gutman agreed to sign away various rights to JLM in exchange for her salary, a stream of royalty payments, and JLM's investment of time and capital in the Hayley Paige brand," the Appeals Court wrote in a 35-page decision. "She offers no persuasive reason why the Contract no longer binds her, and the district court did not err in enforcing its clear provisions."

ABOUT JLM COUTURE, INC.

JLM Couture, Inc. (OTC: JLMC) is a multi-label bridal house engaged in the design, manufacture, and distribution of bridal gowns and bridesmaids dresses. The company's bridal gown collections are Hayley Paige, Blush by Hayley Paige, Lazaro, Tara Keely, Ti Adora, and Allison Webb. The bridesmaid collection is Hayley Paige Occasions. JLM Boutique, the company's flagship bridal store, is located in West Hollywood, California.

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SOURCE JLM Couture

FAQ

What was the result of the recent appeals court decision regarding JLM Couture and Hayley Paige Gutman?

The Second Circuit Court affirmed that JLM Couture did not breach its contract with Hayley Paige Gutman and upheld their enforcement of a noncompete clause.

What impact does the court ruling have on JLM Couture's operations?

The court's decision strengthens JLM's control over its brand and contractual agreements, enhancing its operational stability.

Will ownership of Hayley Paige's Instagram account be resolved by this court ruling?

No, the appeals court did not determine ownership of the Instagram account and remanded this issue to the District Court.

What does the ruling mean for shareholders of JLM Couture (JLMC)?

The ruling supports JLM's legal rights and may boost shareholder confidence in the company's management and brand protection.