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Former Estee Lauder chair tells INTA sea stories

“In the Navy you don’t learn from textbooks, you have sea stories instead,” Leonard A. Lauder told attendees in his keynote speech at the opening ceremony yesterday. The Chairman Emeritus of The Estée Lauder Companies, Lauder joined his parents’ company in 1958 when he left the US Navy. “I looked pretty sexy in that Navy uniform,” he remembered.

With affecting honesty and humor, Lauder told several of these “sea stories” about the Estée Lauder brands, their successes and failures, in the hope of revealing some lessons for attendees: “In the 1950s there was a saying among advertising executives—the kind you see in the television series Mad Men today. They used to say: ‘Let’s get down on all fours and look at this from the client’s perspective.’ Well here goes,” he said.

The first story described the launch of beauty brand Clinique in 1968. The company and its lawyers had searched thoroughly for similar trademarks and, satisfied there was nothing similar out there, went ahead with production. But a month before launch, the lawyers phoned to say there had been a complaint from a product called Astringent Clinique. “We looked under ‘C’ but we forgot to look under ‘A’,” said Lauder.

The mark was registered by a magazine called Cat Fancy. Lauder went to talk to the owner, who asked for 5% of Clinique’s revenues in payment. The company paid $100,000 over five years instead—which has proven to be a wise decision, given Clinique’s growth. “I adore that trademark and I think the lesson is: you can never be too careful,” Lauder told the audience.

He loved another brand, Origins, so much that he bought the company. But a shop in Santa Fe, New Mexico, sued, claiming Lauder and his wife had been into the shop, liked the name and launched the brand to copy it. “Now I had bought Origins two years before this woman (who cried a lot!) claimed I had gone in. But did that make me right? My lawyers advised me that I would win eventually, but only after I had lost to a jury and appealed a couple of times. It was much cheaper to settle, so we did, and I’ve been glad ever since. Being right is one thing, but living well is another. And I like living,” Lauder told the audience, to a round of applause.

So what was the lesson from that experience? “As a lawyer it’s your job to convince clients that they don’t have to win every time. They are probably very successful, they probably win at business, at golf, at everything. You need to tell them not to spend all their money on you, just to be right.”

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