The Billion-Dollar Hermès Drama: How LVMH's Arnault Faces Massive Lawsuit Over Hidden Share Shuffle

A Family Fortune Vanishes: The Allegation

Nicolas Puech, once a prominent billionaire and key shareholder in the iconic Hermès family empire, has taken legal action against LVMH and its mastermind Bernard Arnault. The stakes? A staggering 14 billion euros (approximately $16.3 billion) in Hermès shares that Puech claims were liquidated without his consent. According to court filings, his wealth manager Eric Freymond allegedly orchestrated the sale of roughly 6 million Hermès shares during the period when Arnault was quietly accumulating his own position in the luxury brand.

The Missing Shares Mystery

The lawsuit names multiple defendants including Freymond, Arnault, LVMH, and their associated holding companies. Puech’s legal team alleges that Freymond executed the share transfers covertly while LVMH was mounting its strategic acquisition of stakes in the Birkin bag manufacturer over a decade-long campaign. What makes this case particularly contentious is the timing—the alleged unauthorized transactions occurred precisely when Arnault was building up his hidden leverage in Hermès.

LVMH has pushed back against the accusations, issuing statements denying any misappropriation of Hermès shares and categorically rejecting claims of holding “concealed” positions in the luxury goods producer. However, French prosecutors have opened a criminal investigation into Puech’s allegations.

One complication in pursuing justice: Freymond, the wealth manager at the center of the dispute, died in July 2024 after being struck by a train in Switzerland. Currently, he remains the sole figure under criminal investigation, as reported by the Paris prosecutor’s office.

How Arnault Built His Luxury Empire—And Set His Sights On Hermès

Understanding this conflict requires looking at Arnault’s broader acquisition strategy. Over decades, the LVMH founder has systematically consolidated luxury brands, purchasing Sephora in 1997 and acquiring the storied jeweler Tiffany & Co. for $15.8 billion in 2021. This empire-building approach was also directed toward Hermès.

In 2010, Arnault publicly revealed he had amassed a substantial 23% stake in Hermès through LVMH—a significant position in one of his fiercest competitors in the ultra-luxury segment. The disclosure triggered tension between the two houses. Four years later, in 2014, a settlement was reached: Arnault agreed to distribute LVMH’s Hermès stake to shareholders as a dividend, but LVMH’s holding company retained an 8.5% minority position in the company, maintaining ongoing influence.

Now, Puech’s lawsuit threatens to reopen questions about how that LVMH stake was accumulated and whether transparency was compromised in the process.