Melbourne's most fashionable court case starts on Monday with the first of a three-day trial between department store Myer and young Sydney designer Kimberley Ellery.
Myer is seeking an injunction preventing Ellery from supplying any more clothing from her Ellery Land and L'America labels to its rival David Jones, and damages against Ellery for breaching an exclusivity contract and for failing to deliver an order for Myer's 2013 autumn-winter collection.
However, the size of damages would not be known until after Justice Michael Sifiris of the Victorian Supreme Court decides whether Ellery is liable.
Myer withdrew in January a request for an interlocutory injunction that would have prevented Ellery Land clothing appearing in David Jones' fashion week.
It was now seeking a final injunction preventing Ellery from supplying David Jones until her three-year exclusivity contract with Myer ends in late 2014.
Ellery's barrister, Charles Shaw, has previously told the court the contract with Myer was excessively restrictive because it "does not oblige Myer to buy anything from the defendant" but prevented his client from supplying David Jones.
Meanwhile, court documents reveal Ellery first met with David Jones staff on August 16 last year, a month before Myer placed the autumn 2013 order that Ellery failed to fulfil. And that David Jones sent her an exclusivity letter on November 7, which she signed two days later. However, Myer did not learn she had signed a contract with David Jones and would be a key part of its 2013 collection until December 2.
According to an affidavit by executive general manager of merchandise at Myer, Adam Stapleton, Ellery's business adviser told him "the financial consequences for breaching the contract with David Jones would be significantly greater" than with Myer as Ellery would "need to reimburse David Jones" for printed catalogues.
Ellery and her adviser claim Ellery Land was stocked in only four of Myer's 67 stores and that her clothing appeared in Vogue, Harper's Bazaar, Ragtrader and Grazia before she signed a deal with Myer, according to her affidavit.
They claim that stylists for Madonna, Rihanna and Lady Gaga requested Ellery Land clothing. She also disputes the value of providing free dresses for Myer spokeswoman Jennifer Hawkins, saying she had begun invoicing for them.