Hundreds of Ralph Lauren outlets have been shut down in the Indian Ocean island of Mauritius, after a court granted the American fashion designer and retailer an injunction against the shops using the trademark.
By Nita Bhalla
The American fashion powerhouse claims that the shops have been using the trademark without permission and now wants the businesses to be closed permanently.
Many tourists bought cheap designer clothes in Mauritius
The local outlets however claim that they have been operating legally and say the closure of the shops will mean thousands of job losses in the tiny island.
Mauritius has a population of 1.2 million and the closures will seriously hurt the local economy.
End of honeymoon
If you come to Mauritius, you would think that you had died and come to Ralph Lauren heaven.
Hundreds of factory shops selling garments with the expensive designer label are dotted all over this tiny paradise island.
For years, tourists have flocked to the outlets filling their suitcases with everything from polo shirts to skirts at a quarter of European or American prices.
It is a lucrative business on the island, directly employing around 7,000 people, with a monthly turnover of about $10m.
But now it seems Mauritius's Ralph Lauren honeymoon is coming to an end.
At the end of January, the American fashion powerhouse filed two cases in the Supreme Court saying it has copyright on the Ralph Lauren trademark and "polo player on horseback" logo.
As a result, the court has granted the US designer a temporary injunction leading to the closure of the outlets.
The local manufacturers and retailers however argue they have legal status to operate the outlets.
This is after the government allowed the registration of the trademark by a local company 12 years ago.
In 1992, the government's customs department allowed a local company, the Aurdally Brothers, to register the Ralph Lauren trademark and logo under their name.
And the Aurdally Brothers gave permission to a company called Captain Tasman, to produce merchandise under their licence.
Director of Captain Tasman, Ajay Beegoo says it was all legal.
" Everything was done in the legal form at that time and according to the law in our country" said Mr. Beegoo
In 2000, following complaints from Ralph Lauren in the United States, the government did not renew the license and removed Ralph Lauren from the trademark register.
Since then no one, not even Polo Ralph Lauren itself, has rights over the trademark in Mauritius.
Some other manufacturers and retailers have taken advantage of the existing loophole.
Now, thousands of jobs are under threat and retailers believe that will add to the island's growing unemployment and hurt the local economy.
" Many people will be affected, plastic bag factories, label makers, we converted villages into towns now no tourists will be going there, no one will get money" said Mr Beegoo.
Mauritius's Foreign Affairs and International Trade Minister, Jaya Cuttaree, concedes that the economy will be hard hit.
"It's a big problem but we do not want anyone to lose their jobs, this is not of our doing," said Mr Cuttaree
But the head of public relations at Ralph Lauren's head office in New York, Nancy Murray has said they are protecting their trademark.
The number of unemployed people is expected to rise
"It's part of our normal course of making sure that our trademark is protected worldwide," said Ms Murray.
On the other hand, Mr Beegoo says negotiations would have been the best way to deal with the dispute.
"It would have been best to sit around the table agree and keep the business going - but not the way the Americans have done it," said Mr Beegoo.