SOURCE: Gary Iskowitz & Company LLP

August 27, 2009 15:04 ET

Georges Marciano Ordered to Pay $55 Million to Former Accountant in Libel Lawsuit

Judge Rules Guess Jeans Co-Founder Tried to Ruin Reputation of Gary Iskowitz; Calls Marciano's Conduct "Despicable, Malicious"

LOS ANGELES, CA--(Marketwire - August 27, 2009) - A Los Angeles judge ruled yesterday that Georges Marciano, co-founder of Guess Jeans, tried to ruin the reputation of his former accountant, Gary Iskowitz, and must pay $55 million in libel damages to Iskowitz, his business partner and his wife. The ruling comes on the heels of a multimillion-dollar verdict against Marciano last month in a defamation suit filed by five former employees.

"Gary Iskowitz has established that Marciano's conduct in repeatedly libeling him was not only intentional and in reckless disregard of the probability that Iskowitz would suffer emotional distress, but was also despicable, malicious and oppressive," wrote Los Angeles County Superior Court Judge Elizabeth Allen White in her order.

The case centered on a libelous campaign Marciano began in August 2006 against Iskowitz, during which Marciano undertook numerous actions to damage Iskowitz's reputation, including filing a complaint against him with the California Board of Accountancy, submitting IRS 1099 Forms falsely claiming Iskowitz was paid $460,000, and accusing Iskowitz of numerous crimes in correspondence to local and federal officials. The judge found the allegations were "all completely and utterly false."

According to Iskowitz's attorneys, Stephen J. Tully, Efren A. Compean and Tatiana Wallace of Garrett & Tully, Marciano initiated his campaign after Iskowitz investigated and found no basis for claims by Marciano that his employees were stealing from him. Those former employees were awarded $370 million in July by a jury in a defamation suit against Marciano.

"Marciano set out on a premeditated plan to ruin Gary Iskowitz. The court found that he used threats, intimidation and accusations he knew were completely false in more than 30 letters and e-mails that were sent to public agencies, banks and business associates of Gary Iskowitz," Tully said. "While this judgment exposes Marciano for what he is, the sad truth is that no amount of money can repair the enormous damage to my client's reputation."

Iskowitz is the founder of Gary Iskowitz & Company LLP, an accounting firm serving businesses and high-wealth individuals and families. He began his career at the Internal Revenue Service, where he worked for 12 years. He founded his current firm in 1981 and is a respected expert in dealing with Internal Revenue Service matters and complex tax issues, giving numerous speeches at national conferences and previously appearing on KABC-TV as a commentator.

Judge White ruled that Marciano must pay $45 million to Gary Iskowitz, CPA for libel and intentional infliction of emotional distress, as well as $5 million each to his wife, Theresa Iskowitz, CPA and his business partner, Carolyn Malkus, CPA for libel.