L'Oréal Spies On Guinot
Paris, 14 February 2021. On Friday 12 February, a hearing was held at the Paris Commercial Court following a summons by Guinot against L’Oréal. This hearing was an opportunity for both parties to argue their case before the magistrates. Guinot accuses L’Oréal of espionage and appropriation of know-how and expertise. In 2014, L’Oréal sent consultants to Guinot franchises, the key to the company’s know-how, using a false identity to make the franchisees believe they were part of a study commissioned by Guinot itself.
Guinot wants the misappropriation of its know-how to be penalised by the courts and to obtain compensation for damages suffered as a result.
“The hearing was an opportunity to qualify the facts and situate the importance of the issues.
I have full confidence in the court.
The truth always prevails and kills its enemies.”
Jean-Daniel Mondin – Guinot President
L’OREAL SPIES ON GUINOT Hearing before the Paris Commercial Court held on Friday 12 February
Overview of the facts reported by Guinot:
In 2015, Guinot discovered that L’Oréal had commissioned an attempt to appropriate Guinot’s know-how on behalf of Carita, a company it had acquired one year earlier. Guinot is the leading beauty salon brand in France, while L’Oréal does not have a presence in this market. Since the 2000s, the senior management of L’Oréal Professionnel, particularly the company’s future CEO, Nicolas Hieronimus, has initiated several merger attempts with Guinot-Mary Cohr with a view to entering a market in which it does not compete. A written bid to acquire the company was made by L’Oréal in June 2012 which Jean-Daniel Mondin, as Guinot’s founder, President, did not accept.
In September 2013, L’Oréal announced that it was no longer interested in acquiring Guinot-Mary Cohr, choosing Carita-Decléor instead. Several news articles announced L’Oréal’s arrival on the beauty salon and spa market with these two brands. In order to identify the importance of these brands on the beauty salon market, L’Oréal commissioned an initial general study. The results of this study, conducted in May 2014, concluded that Guinot was the key brand due to its provision of anti-ageing treatments through its flagship Hydradermie treatment tailored to individual skin types. Subsequently, in December 2014, L’Oréal commissioned an in-depth survey of beauty therapists and customers to study Guinot products and services.
This study, approved by Jacques Challes, Chief Innovation Officer of the Research and Innovation Division, was approved by the legal department. The study contract should never have been signed, much less performed, as it contravened the confidentiality agreement relating to the potential acquisition of Guinot, valid until September 2015. Furthermore, the study also contravened the confidentiality agreements signed by the franchisees surveyed. Finally, the beauty therapists surveyed never signed the written documents informing them of the aims of the study, as stipulated in the contract signed by L’Oréal and the consultancy firm.
This was an intrusive study of Guinot franchised beauty salons, whose main aim was to survey affiliated beauty therapists on the methods and effectiveness of their in-salon treatments and customer interest in these treatments.
The affiliated beauty therapists raised the alarm, surprised at being contacted by so-called Guinot representatives looking to understand the perception of in-salon treatments, particularly those using treatment devices, and to observe how treatment devices are used. Their surprise was exacerbated as they were offered a cheque for €100, supposedly to cover transport costs, despite the interviewer coming to their salons. They considered this to be an act of corruption.
It should be noted that it is forbidden to carry out in-depth studies of one single competitor, particularly in salons where know-how is secret, unique and protected. Guinot warned all of its affiliate partners of this attempted appropriation and referred the matter to the Paris Commercial Court, who authorised the seizure of incriminating documents (with L’Oréal letterheads) from the consultancy firm’s headquarters. A second court order allowed Guinot to seize L’Oréal’s internal emails, in which management admitted their wrongdoing, contradicting all the letters they had sent to Guinot up to that point.
The documents seized from L’Oréal and the consultancy firm confirm the involvement of L’Oréal Professionnel, as the Carita brand is constantly mentioned. L’Oréal’s internal emails report an initial meeting for the study attended by Carita’s Marketing Director (Emmanuelle Labrousse) and L’Oréal Professionnel’s Director of Skincare (Florence Bénech).
This is proof that the espionage took place, reflecting the gains that Guinot has made in the beauty salon market, in which it is a leading brand. The Vice-President of the Research and Innovation Division met with Jean-Daniel Mondin at his headquarters on Rue de la Paix and stated that the L’Oréal Professionnel division, led by Nicolas Hieronimus, did not commission the study and was not aware of it. Guinot officially requested an affidavit from Nicolas Hieronimus to confirm that he had no knowledge of this study. There was no response to this request.
Guinot therefore requested mediation to obtain the affidavit from Nicolas Hieronimus. It was eventually discovered that regardless of regulations and ethical guidelines, the mediator had signed an affidavit confirming his independence from the parties to perform the mediation. However, the L’Oréal representative did not provide an affidavit from Nicolas Hieronimus as requested by Guinot. The mediation process was closed the day after it began. Subsequently, and in contravention of mediation regulations, the mediator contacted Jean-Daniel Mondin, Guinot President, to continue the mediation personally, admitting that he had been appointed by L’Oréal, specifically by L’Oréal’s lawyer, with whom he had a personal relationship.
By order of the Commercial Court, bailiffs accompanied by IT specialists were prevented from fulfilling their tasks at L’Oréal headquarters. Inaccurate testimony by Jacques Challes, who approved the study in his role as Chief Innovation Officer, was noted in the preliminary inquiry relating to the consultancy firm, as he claimed that L’Oréal was studying Guinot and Carita with a view to acquiring one of the two companies, even though it had already acquired Carita over a year earlier.
Instead of admitting its guilt, the world’s leading cosmetics company chose to defend itself by lying, thus eschewing its responsibilities and severely breaching fair trade regulations. L’Oréal’s actions seem to have been guided by a sense of impunity, which is made worse by the fact that the actions of its directors are governed by its own ethical guidelines.
In 2017, RTL, Radio Classique and Opinion Internationale all reported on L’Oréal’s espionage against Guinot. L’Oréal could have brought an action for libel to remove the word “espionage”, thus restoring its honour. Instead, it submitted a counterclaim of threats and blackmail, which was closed without further action two months after it was opened.
These extremely serious allegations call into question the directors of L’Oréal, including Jean-Paul Agon, Nicolas Hieronimus, Yannick Chalmé (Group General Counsel), Laurent Attal (Executive Vice President of L’Oréal, Head of Research and Innovation), Emmanuel Lulin (Chief Ethics Officer) and Loïc Armand (President of L’Oréal France), and are inconsistent with the ethical guidelines applicable to all group employees.
Guinot and its partner beauty therapists are shocked by L’Oréal’s behaviour, but are proud to know that the quality of the treatments and know-how to which they contribute have inspired envy in the world’s leading cosmetics company.
Press Contacts:
Frédéric Jaillant: jaillant@wanadoo.fr
Ingrid Gizzi: ingrid@franckdrapeau.com