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1、TROUSERSUIT TheEuropeanCourtsideswithLeviStraussinitsbattlewithTesco ITWASarulingthathadconsumersseethingwithangerandmanyafreetradercryingfoul.OnNovember20ththeEuropeanCourtofJusticedecidedthatTesco,aBritishsupermarketchain,shouldnotbeallowedtoimportjeans
2、madebyAmerica''sLeviStraussfromoutsidetheEuropeanUnionandsellthematcut-ratepriceswithoutgettingpermissionfirstfromthejeansmaker.Ironically,therulingisbasedonanEUtrademarkdirectivethatwasdesignedtoprotectlocal,notAmerican,manufacturersfrompricedumping.Theide
3、aisthatanybrand-owningfirmshouldbeallowedtopositionitsgoodsandsegmentitsmarketsasitseesfit:Levi''sjeans,justlikeGuccihandbags,mustbeallowedtobeexpensive. LeviStrausspersuadedthecourtthat,bysellingitsjeanscheaplyalongsidesoappowderandbananas,Tescowasdestroy
4、ingtheimageandsothevalueofitsbrands――whichcouldonlyleadtolessinnovationand,inthelongrun,wouldreduceconsumerchoice.ConsumergroupsandTescosaythatLevi''scaseisspecious.ThesupermarketarguesthatitwasjustarbitragingthepricedifferentialbetweenLevi''sjeanssoldinAme
5、ricaandEurope――aserviceperformedamilliontimesadayinfinancialmarkets,andonethathasledtorealbenefitsforconsumers.Tescohasbeensellingsome15,000pairsofLevi''sjeansaweek,forabouthalfthepricetheycommandinspecialiststoresapprovedbyLeviStrauss.ChristineCross,Tesco'
6、'sheadofglobalnon-foodsourcing,saystherulingriskscreatingaFortressEuropewithavengeance. Thedebatewillrageon,andhasimplicationswellbeyondcasualclothes(LeviStrausswasjoinedinitslawsuitbyZinoDavidoff,aperfumemaker).Thequestionatitsheartisnotwhetherbrandsneedt
7、ocontrolhowtheyaresoldtoprotecttheirimage,butwhetheritisthejobofthecourtstohelpthemdothis.Gucci,anItalianclotheslabelwhoseimagewasbeingdestroyedbylooselicensingandover-exposureindiscountstores,saveditselfnotbyresortingtothecourtsbutbyendingcontractswiththir
8、d-partysuppliers,controllingitsdistributionbetterandopeningitsownstores.Itisnowhardtofindcut-priceGuccianywhere. BrandexpertsarguethatLeviStrauss,whichhasbeenlosingmarketsharetohipperrivalssuchasDiese
