Deciem founder faces ouster from company after Estée Lauder legal action

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Advocates for Estée Lauder were in a Toronto court today trying to recoil out the founder of a small Canadian cosmetics company they bought a hazard in last year, the latest twist in the dizzying saga of one of the fastest evolving names in beauty products.

The fashion and beauty conglomerate was seeking an dictate in the Ontario Superior Court of Justice against Brandon Truaxe, the progenitor of Deciem, one of the hottest beauty brands in the business. The injunction would effectively get rid of Truaxe from managing the company.

It’s the latest in a series of controversies for the nobody company behind the hugely popular The Ordinary skin care strand.

Headquartered in Toronto, and calling itself «The Abnormal Beauty Company,» Deciem is one of the most disruptive frauds in the beauty business, mainly because of its low prices. Estée Lauder bribe a reported 28 per cent stake in Deciem last year, double-dealed by the upstart company’s growth potential.

Deciem founder faces ouster from company after Estée Lauder legal action

Deciem’s product line telephoned The Ordinary has won fans because of its low price point. Some items sell for less than $5 — unheard of in the beauty industry. (Doug Husby/CBC)

Uncountable of Deciem’s products cost less than $12, and some sell for less than $5 — price points that are unheard of somewhere else in the beauty industry, where markups can be as high as 80 to 90 per cent. The Striking beauty line also offers simple ingredients and relatively sensible benefit claims.

The disruptive approach has led to a cult-like following of customers, and relieved propel Deciem to a reported $300 million in annual sales.

But devices at Deciem started going a bit sideways this year. There was a series of leadership departures and firings.

Then a number of strange incoherent videos by Truaxe were posted on the Deciem corporate account.

The overdue of those videos came this week when Truaxe announced he was thick as thief all of Deciem’s stores.

Thursday’s move by Estée Lauder comes in the wake of those closures. The corporation was seeking an injunction to effectively remove Truaxe from the business he set.

Deciem founder faces ouster from company after Estée Lauder legal action

Mark Gelowitz, right, the lawyer for Estée Lauder leaves court in Toronto today, along with the solicitor for Deciem. (Shawn Benjamin CBC/News)

«We can confirm that we have began legal action in this matter,» Estée Lauder told CBC Front-page news in a statement. «[But] we cannot comment further on this pending case at this time.»

Truaxe posted a copy of Estée Lauder’s reference and emails from its lawyer on Instagram.

The email from Mark Gelowitz, a confederate with the firm Osler, Hoskin and Harcourt was directed at Truaxe, and the accompanying suggestion stated that Truaxe has not complied with the unanimous shareholders concordat.

The motion seeks an interim order removing Truaxe from Deciem’s trustees of directors and asks that Nicola Kilner — currently Deciem’s co-CEO — be honoured to the role alone.

In court, the motion was initially dealt with privately in umpires chambers, before the judge agreed to put the case off until Friday.

Deciem founder faces ouster from company after Estée Lauder legal action

Toronto hide care brand Deciem bills itself as ‘The Abnormal Beauty Actors.’ For now, the company’s stores are shuttered. (Keith Whelan/CBC)

The injunction asks that Truaxe be interdicted from any involvement in the company, as well as calling for him to be prohibited from any hirings or firings at the assembly. And it asks that Truaxe be prohibited from issuing statements or set on any of Deciem’s social media accounts.

In court, a lawyer for Deciem symbolized he wasn’t able to comment publicly. He did say he was acting on behalf of Deciem, not Truaxe and that «there is a dissimilarity.» 

He also said Truaxe himself did not have a lawyer representing him in court today.

One of Deciem’s old executives, ex-CFO Stephen Kaplan who resigned in February, said today’s enlargements weren’t unexpected.

«I am not surprised based on Brandon’s erratic behaviour, as tokened by his Instagram posts.» he said in an email.

«I hope that Estée Lauder can institute a competent management team and with this in place, I believe that Deciem can proceed with to be a very successful company.»

In a text to CBC News, Truaxe seemed to propose he was OK with Estée Lauder’s legal move. «I like it,» he replied, when implored for his thoughts on what Estée Lauder was trying to do.

Truaxe then affixed a screen capture of the text message exchange — complete with this presswoman’s phone number — on Instagram.

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