shops & showrooms | Apr 16, 2023 |
Jean de Merry abruptly shutters its multiline business

Jean de Merry has shuttered its multiline showroom business. The Los Angeles–based company, which combines an eponymous furniture collection with a roster of represented textiles and furnishings brands, has closed its locations in New York, Los Angeles and Chicago over the past month; while not officially shuttered, the Dallas location is currently closed and its fate is uncertain. In a recent note sent to vendors, the brand announced that it was ending its representation agreements and focusing on its own line.

In an interview with Business of Home, co-founder Christian Maroselli pinned the abrupt shutdown on a series of escalating financial problems that came to a crescendo this spring.

According to Maroselli, he was advised by lawyers to withhold rent on the company’s showroom spaces at the onset of Covid as part of a tactic to negotiate rent relief amid pandemic lockdowns. Those debts built up, and the Pacific Design Center and the Decoration & Design Building—both owned by Cohen Brothers Realty—took Jean de Merry to court to collect.

Though Maroselli and Cohen Brothers were able to reach a temporary agreement last summer, according to court documents, Jean de Merry once again began missing its rent payments to the PDC in December of last year, violating the terms of the deal. The PDC claims at least $606,852 in unpaid bills. In September of last year, the D&D Building won a judgment for $649,371.

“We didn’t really have a choice but to close [New York and Los Angeles],” says Maroselli, adding that, despite also owing rent in Chicago’s The Mart and the Dallas Design Center as well, the landlords in those locations were more amenable to a negotiation. He expressed hope that the company could work out a deal to stay in both buildings and reimagine the showrooms as venues for its house line.

Over the past 12 months, Jean de Merry has also taken out a series of high-interest loans known as MCAs, or “merchant cash advances,” in which a lender advances money in exchange for a share of future receipts. Court documents indicate that at least three of these lenders have taken Jean de Merry to court for defaulting on payments. One loan—for $75,000, borrowed from a company called Swift Funding California—was taken out on February 16. According to a lawsuit, Jean de Merry defaulted on it less than two weeks later.

Another lender, Itria Ventures, loaned Jean de Merry $510,000 on December 30, 2022. According to court documents filed by Itria, the showroom stopped making payments after February 9. Itria subsequently sent out a lien notice to Jean de Merry’s designer clients and vendors, claiming a right to the brand’s revenue.

Maroselli says that Itria does not have a legal right to Jean de Merry receipts, and that he’s working with a company that specializes in debt relief to extend the terms of the various loans. He says that all in, the company owes roughly $1.2 million to its MCA lenders.

Jean de Merry’s designer clients and represented brands have been caught up in the company’s struggles. According to several vendors who requested anonymity in order to speak freely, the past few months have been a chaotic period of erratic communication from Jean de Merry and rampant confusion about the status of orders.

Several vendors say they have built pieces for the brand but held back delivery awaiting final payment—only to discover later that Jean de Merry had already received money from the designer and failed to pass it along. Others describe a situation in which designers reached out to them directly in a panic looking for a missing order—an order that Jean de Merry had collected a deposit on, but never passed along to the vendor.

Maroselli says that over the past year, the business has been struggling under the weight of its various debts, and admitted that the company has been late to pay its represented brands. He says Jean de Merry currently owes them in the realm of $300,000.

Jean de Merry’s in-house furniture line is still in business, and Maroselli says that it will continue to produce furniture for the showrooms that represent it. Founded in 2001 as a collaboration between Maroselli and his partner Jean de Merry, the company found success with deco-inspired pieces produced out of a Los Angeles workshop. It expanded into a national multiline showroom business over the years, with Dallas the most recent opening in 2015. Maroselli says that de Merry is suffering from Lyme disease and is no longer an active partner in the business.

Maroselli is hopeful that the company would ultimately be able to make good on its debts. “I’m not going to default to the represented designers,” he says. “I’m going to find a way to pay everyone back. But obviously … it is going to take some time. Some represented designers are going to understand, others are not. Some clients are going to stick with me, others won’t. We will see what it’s going to be next.”

For one vendor who says the company still owes them tens of thousands of dollars, it’s already too late: “This has left us reeling,” they tell BOH. “We don’t know who to trust anymore.”

This is a developing story. Please check back for updates.

Homepage photo: Jean de Merry’s shuttered showroom in New York’s Decoration & Design Building | Business of Home

Want to stay informed? Sign up for our newsletter, which recaps the week’s stories, and get in-depth industry news and analysis each quarter by subscribing to our print magazine. Join BOH Insider for discounts, workshops and access to special events such as the Future of Home conference.