Luxury Beauty Standoff: Coty Takes Legal Action Against Kering Over Gucci License Dispute

The deal of the year goes ahead, but not without debate. Coty has opened a legal front against Kering in the midst of the countdown to the transition of the Gucci Beauty license to L’Oréal. The U.S. group’s Swiss subsidiary, HFC Prestige International Operations Switzerland, has filed a lawsuit in a U.K. commercial court against Gucci America, Guccio Gucci and Kering, according to British public records.

The proceedings, filed on October 20th, fall under the category of commercial contracts and agreements, although the exact details of the claims have not been made public at this stage.

The dispute has erupted after Kering and L’Oréal announced an agreement for the French giant to enter into a fifty-year exclusive license to create, develop and distribute Gucci fragrances and beauty when the current contract with Coty, scheduled to expire in 2028, expires. This move is part of the €4 billion sale of the beauty division of the Gallic luxury group led by Luca De Meo since last September. Both Kering and L’Oréal assured then that the obligations of the existing agreement will be respected.

Coty defends its position until 2028, when Gucci’s licensing agreement ends

During the presentation of results for the first fiscal quarter 2025-2026, Coty CEO Sue Nabi avoided commenting on the litigation but assured that the company “will defend its rights until the last day, until the last hour of the contract.“ For its part, Kering categorically rejected the accusation and said it will “firmly” defend its rights against Coty.

Coty has stressed that the current license remains in full force, that it will continue to operate Gucci Beauty under the same structure and that the contractual relationship remains unchanged. However, Nabi left the door open to evaluate an early exit if it “creates real value” for the company.

According to Evercore IRI, the Gucci license represents about 8% of the U.S. group’s total sales and 11% of its profits. Coty has operated the Roman firm’s beauty business since 2016.

At the French group’s results presentation, Kering’s chief operating officer Jean-Marc Duplaix qualified that the plan remains to wait for the natural expiration of the contract before the start-up with L’Oréal. L’Oréal CEO Nicolas Hieronimus also indicated that he has no visibility on possible early talks between the two parties.