Leonard Rabinowitz and M. Carole Rabinowitz - Page 4

                                         -4-                                           
          Petitioners’ Fashion Company                                                 
               At Jasper Brothers, Mr. Rabinowitz saw Ms. Little’s design              
          talent and suggested they go into business together, so that Ms.             
          Little could design under her own name.  Ms. Little was excited              
          by the opportunity to design her own line and generally                      
          fascinated with fashion and the industry.  She accepted Mr.                  
          Rabinowitz’s plan, although she admittedly did not know much                 
          about going into business at the time.  The couple started                   
          California Fashion Industries (CFI) in 1974.4                                
               Petitioners positioned CFI in the higher end of the women’s             
          apparel market.  CFI designed women’s apparel, arranged for its              
          manufacture, and distributed the apparel to higher end department            
          and specialty stores.  CFI had a unique angle on the market by               
          targeting its apparel to the needs and preferences of the baby               
          boomer woman.  This meant that Ms. Little’s designs gradually                
          evolved over the years so that the apparel would continue to be              
          relevant to the baby boomer woman as she aged from her                       
          midtwenties to her thirties and forties and beyond.  This                    
          strategy of building a brand that customers knew and could trust             
          generated considerable loyalty among CFI’s customers in                      
          succeeding years.                                                            
               While Ms. Little was responsible for the creative end of the            
          business, creating both clothing designs and artwork, Mr.                    
          Rabinowitz put his sales and merchandising talents to use selling            


               4During the relevant years, CFI was an S corporation and                
          petitioners owned a majority of its stock.                                   




Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011