Despite this week's rescue attempts, Escada filed bankruptcy in a German court this morning. The label, which was founded in 1978 has been better known as the target of the anti-fur movement than for its clothes these past few years. Aside from the red asymmetrical dress Katherine Heigl wore to the Oscars two years ago, and an occasional number on Demi Moore, it's dropped largely out of the limelight which can't help its cause when asking for financial salvation. According to Bloomberg, the brand was once the largest women's clothing brand in the world. Today, over 2,200 people will lose their jobs as a result of the bankruptcy and the company's unlikely recovery. While it's difficult to watch such a formerly strong brand fail, we're still impressed that so few high fashion labels have reached that point.
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Jonathan Saunders Designs for Escada
Last November, when Megha Mittal--daughter-in-law of billionaire Lakshmi Mittal--acquired bankrupt German fashion brand Escada for a reported 30 million euros, onlookers were curious as to what exactly she'd do with the struggling label. Back then, I speculated that Mrs. Mittal was an Escada customer, and that this would be the Wharton Business School graduate's baby. Looks like that has proven true, as Mittal has taken multiple steps to bring the firm out of the red, including new retail stores for Escada and Escada sport, as well as lower entry price points and more daywear. (Because not everyone can be bothered with sequined dresses.) In her latest effort, Mittal has brought on London-based designer Jonathan Saunders to create a capsule for Escada Sport. Saunders, who's best known for his colorful prints, fits well with the brand--or, more precisely, where the brand seems to want to go. The collection will be released for resort 2012.
Betsey Johnson Files for Bankruptcy
Betsey Johnson LLC, the licensee that operates Betsey Johnson’s 63 freestanding stores, women’s apparel and e-commerce, has filed for Chapter 11 bankruptcy, WWD is reporting. Most of the 63 stores will close within the next few week and 350 employees are expected to be let go. Betsey Johnson herself will stay on as creative director to design the brand's lower priced Betsey Johnson line, sold in Macy's and other mass retailers, as well as oversee accessories and other licenses. "I love the moderate price range," she told WWD. "It is in synch with all the girls who are buying my clothes." Jonathan Friedman, Betsey Johnson's CFO, issued the following statement: