What Happened to Melania Trump's Caviar Skincare Line?

[What Happened to Melania Trump’s Caviar Skincare Line?] [Insert alt text here] Story by Peter Moskowitz Time moves fast in 2016. It was less than a year ago that pundits were predicting Donald Trump would drop out of the presidential race before it got too serious; it was only a month ago that people were [accusing Melania Trump of plagiarizing] part of her Republican National Convention speech from Michelle Obama (that feels like it happened six months ago, right?), and it was just a few weeks ago that I was browsing through melaniatrump.com, trying to find a link to purchase some of her branded products. Her jewelry was there; a collection of gem-encrusted bracelets, watches, and necklaces that [The New York Times once described as] "Louis XIV by way of Atlantic City." But it was her skincare products that really intrigued me: a line of facial lotions, exfoliators and cleansers laced with caviar apparently imported from the south of France. The [website copy] was endearingly vague and insane-sounding: "Through intense collaboration with Melania’s research laboratory, it was discovered that the secret to anti-aging can be explained in three distinct parts. This is known as the aging pyramid." (The aging pyramid is described with an image of a triangle and the words: "Loss of nutrients, extrinsic stress, lack of receptivity." No other information is provided). [Insert alt text here] Melania Beauty on melaniatrump.com Photo: melaniatrump.com c/o The Wayback Machine Then everything vanished. Navigating to melaniatrump.com now redirects you to trump.com, the homepage of the Trump Organization. No lotions and jewelry, just skyscrapers and golf courses. The [media speculated] that Melania [removed the site] after some questioned whether she’d actually received the architecture degree from Slovenia listed in her web biography. Later, she [tweeted]: "The website in question was created in 2012 and has been removed because it does not accurately reflect my current business and professional interests." Melania Trump’s oeuvre of products had piqued my interest before her site was shut down, but its disappearance made me even more fascinated. The story behind her jewelry line seemed straightforward: she created the line in 2010, it was sold on QVC, then QVC eventually stopped selling it, [though by all accounts it sold relatively well]. You can still find pieces floating around Craigslist and eBay ([new-in-box pave crystal watch] – $19.99 – Buy It Now). But her skincare products aren’t anywhere— they aren’t for sale on her site, they’re not on eBay or Craigslist or Overstock, not on Amazon or Alibaba (searching ‘Melania Trump’ there brings up a package of snail meat amongst other things). What happened? [Insert alt text here] Melania on Celebrity Apprentice, telling Dennis Rodman and others about her skincare line. Photo: NBC/Getty Melania Trump neé Knauss, now 46, has been a saleswoman for most of her life. She was born in Slovenia and began modeling at 16 in Italy, Paris, New York, and elsewhere ([according to her now-deleted biography]). She moved to New York City when she was 26, where she struggled to find modeling work, but still found enough to make ends meet until 1998, [when she met Donald Trump]. Trump had arrived at a party with another woman, but was apparently so taken with Melania that he approached her while his original date was in the bathroom and asked Melania for her number. She refused, and instead took down his. They married in 2005. Between 2005 and 2010, Melania modeled sporadically for magazines. In 2006, her son Barron was born. In 2010, Melania launched a QVC jewelry line, with pieces priced from $30 to $200. According to some accounts, it sold out its first production in 45 minutes. The style of each piece, [she told CNBC] at the time, corresponded to the style of one of her three homes — Palm Beach, New York City, Paris. In the same interview, she hinted there would be more Melania-branded merchandise on the way: "I’m not done because I have a lot of ideas," she said. "And I love when an idea comes to life." In 2012, Melania Trump signed a deal with Indianapolis-based [New Sunshine LLC], a holding company for a variety of branded skincare products. New Sunshine LLC also holds contracts for bronzers with both JWoww of Jersey Shore fame and the Kardashians (unlike other Kardashian products, this bronzer is not branded by a specific Kardashian, but by the entire clan; it’s called Kardashian Glow). Lord and Taylor began to sell Melania’s line. Trump advertised it on her eponymous website. She sat down for dozens of interviews, explaining that caviar was the most hydrating and age-defying substance out there, explaining that she’d developed the line herself, hired a chemist herself, that she’d spent years on it, that she’d used similar creams on her own skin for years. New Sunshine LLC apparently expected it to be big too. It didn’t work out that way. To understand what happened to Melania Skincare by Melania Trump, you have to understand that very rich people’s personal feuds can have outsized consequences. Steve Hilbert is a multimillionaire who became rich by growing his small, Indianapolis insurance company into a multibillion dollar behemoth called Conseco. But Hilbert took some risky bets, borrowing heavily from his own company for other ventures and to buy up his own company’s stock for personal gain. He lost nearly all of it when Conseco’s stock crashed in 2000. To understand what happened to Melania Skincare by Melania Trump, you have to understand that very rich people’s personal feuds can have outsized consequences. John Menard is a multibillionaire and Wisconsin’s richest man. He’s also a diehard conservative who was recently in the spotlight [when a Gawker story revealed] the right-wing anti-tax training materials Menard requires his thousands of hardware store employees to read as a condition of their employment. Menard, Hilbert, and the Trumps, both Melania and Donald, were all friendly. In 1998, Donald Trump and Hilbert partnered to [buy New York City’s GM building for $800 million]. In 2003, the Trumps, Hilbert, and Menard vacationed together at the Trumps’ 126-room estate/resort in Palm Beach, Florida. Around then, Hilbert and Menard went into business together — they made $200 million worth of investments in tanning lotions, tanning bed manufacturing, and tanning salon management software, making such a splash in the tanning world that a business publication deemed Indianapolis the new "tanning bed capital." They gave their new tanning conglomerate the name New Sunshine, LLC. Then things began to go poorly. Here’s what we know from court transcripts: By 2011, Melania Trump had been developing a line of skin creams on and off for 10 years. She’d started in the early 2000s, hiring a chemist and a skin expert named Tammy Fender, who worked near Melania’s Palm Beach home. Trump put it all on hold when she had her son Barron in 2006. But in 2011, as fate would have it, New Sunshine LLC was looking for a new skincare line. The company had already chosen a spokesperson, Katie Stamm, a former Miss America, but then decided she was too young to market anti-aging creams, and seemed better to market products at lower price points. "Melania’s other attribute is [she’s] just higher end," said Eric Weber, the former president of New Sunshine, under cross examination in an Indianapolis courtroom in 2013. "She connotates a higher end or a more prestigious beauty user which also implies a higher price point… she gives off the aura of higher… more prestige." Given Melania’s prestige, signing a contract with her seemed like an obvious move for Hilbert and his team. Unfortunately, it happened as everything at New Sunshine was taking a turn for the worse. Hilbert and Menard had formed another, separate investment vehicle from New Sunshine. Through that company, Menard and Hilbert invested in a local race track. But then the race track faltered, and the duo’s $200 million investment was nearly completely lost. Meanwhile, a woman named Fay Obiad entered Menard’s life. When they got engaged, Menard’s ex-fiancee, a woman named Debra Sands, sued Menard and many of his holding companies, including the one that held New Sunshine. Everyone’s financial and personal lives seemed to be in disarray, and then they signed a contract with Melania Trump. The idea behind Melania’s skincare line was not new or revolutionary. Caviar skin creams have been around for at least 15 years. They range in price from [La Prairie's $440 firming and lifting cream] to discount supermarket chain Aldi’s knockoff, which costs about $10 and is [apparently nearly as good]. Melania’s line was meant to hit the middle of the market. Its prices ranged from $50 to $150 and included a firmer, a moisturizer, a night cream and an exfoliator. [Insert alt text here] It’s hard to tell if caviar creams are a gimmick. Fish eggs do indeed have a lot of protein, vitamins, and enzymes, according to experts. But it’s unclear what caviar cream actually means. The Food and Drug Administration does not require skincare companies to divulge their ingredients or processing methods, so caviar cream could suggest a cream filled with full fish eggs, but it could also mean a cream mixed with whatever’s left after the eggs are sold for more traditional uses (i.e. eating). Melania Trump’s team would not respond to questions specifically about her skincare line, but Pooneh Manshadi, the [CEO of Golden Caviar Skincare], which was founded 15 years ago, told me her company uses extracts from caviar and filters them three times in a factory. She declined to elaborate on what ‘extracts’ are. "Caviar in skin products is a really interesting ingredient, partially because I’m not actually sure what it is, and I’m not sure anyone does," New York-based dermatologist Sejal Shah told me. "The fluid around the egg has fatty acids, proteins, and amino acids that could benefit the skin. But the issue is that it’s not a regulated ingredient, so there’s no way of really knowing." "Caviar in skin products is a really interesting ingredient, partially because I’m not actually sure what it is, and I’m not sure anyone does." And so the potential success behind Melania’s line, several people told me, was not about what was in it, but about how it was sold. What is clear is this: Melania planned on selling the hell out her line. Melania came up with the package designs herself, she tested it on her own, including by [using the creams on her son Barron every night before bed]. She went on one episode of her husband’s show, Celebrity Apprentice, to promote it. She did dozens of interviews — with [CNBC], Good Morning America, [niche beauty sites], magazines. She directed her social media managers to publish photos of the skincare line on her Twitter and Facebook. And then corporate hell broke loose. About a year after Melania signed a contract with New Sunshine, [the company imploded]. John Menard found out that the investment company he’d left Hilbert to manage, MH Private Equity, was making less money than he’d believed. He fired Hilbert, but Hilbert refused to leave. So Menard sued Hilbert and the management company controlled by his wife Tomisue for breach of contract and fraud. Steve Hilbert filed a countersuit. So did his wife Tomisue, claiming Menard had [pressured Tomisue to have a threesome with him and his wife], that he "no longer liked working, was tired of pleasing his customers, and had decided he wanted to live his life fully and fulfill his sexual urges." Somewhere in this mess, Menard decided the only way out of his financial obligations to the company he and Hilbert had started was to sue Melania Trump herself, attempting to void her contract, and claiming Steve Hilbert did not have the authority to sign it without Menard’s approval. And so, just months after it was launched, Melania by Melania Trump was mired in lawsuits. It barely shipped to stores. It got into a few hands. And then it was done. [Insert alt text here] John Menard (left) and Tomisue Hilbert with Kanye West and friend. Photo: Joe Robbins/Getty (L), Jesse Grant/Getty (R) "I got a lot of bad responses back from my fans that they are trying to buy the skincare line, and it is not available," Melania told an Indianapolis courtroom in 2013. "And they were saying I should fire my team… this is not how business is done, and they were blaming me. They were blaming my brand, and I had nothing to do with it. I was pushing it… [and] the product was nowhere to be found." It’s hard to find emotion in court transcripts, but Melania’s anger jumps off the page. "The damage was done," she said. "I promoted all around the world. The product was on the national TV all around the world, all the magazines and [the product] was nowhere to be found… The damage to the brand was done." (If the [media reports] about her never receiving a degree from a university in Slovenia are true, the court transcripts also reveal Melania lied under oath about her degree when she told the court she’d graduated with a bachelor’s in architecture). [Insert alt text here] The Trump Organization would not set up a call with Melania herself, but offered a spokesperson named Alan Gartan who told me: "The history of what happened is all in those legal documents… but the result of the litigation vindicated her position." New Sunshine did not return multiple calls for comment. The result of the litigation was this: an Indianapolis judge ordered the company, Hilbert, and Melania into arbitration, where a deal was worked out for an undisclosed sum. A year later, Melania sued New Sunshine for $50 million, the amount she felt she would have made had the product been properly launched. She settled out of court. "She was really a victim of circumstances that were not her making," Steve Hilbert, the businessman who used to run New Sunshine, told me over the phone from Indianapolis. "Her dedication to the brand would have been phenomenal. But sometimes litigation starts for shitty reasons." According to Hilbert and another former New Sunshine executive, Scott Matthews, Melania Trump was a joy to work with. "It doesn’t take long if you talk to her — her beauty, her style her elegance of course visually instantly catches your eye," Hilbert said. "She’s not pushy, she’s not arrogant, but she’s very focused. She knows what’s right and she only does what’s right." Hilbert and Matthews both told me that Melania was a tough negotiator. They pointed out that while their contract negotiations with JWoww and the Kardashians took a matter of days, Melania’s took 11 months. Hilbert remains friends with the Trumps today, perhaps evidenced by his tweet in which he claims he [claims Menard’s employees are treated horribly]. "I think she will be the next First Lady of the United States," Hilbert said. "And I think she’ll bring to that position a sense of focus, and helping others, and a style that’s refreshing." It’s unclear why Melania Trump has not tried to launch a product since the failure of her skincare line. Court transcripts suggest that Melania was indeed passionate about her designs, and mad when they did not come into the market in the way that she wanted. The transcripts also make it clear that Melania is a serious business woman, that given the opportunity and a company more competent that New Sunshine, she might be able to launch many more successful products. And the court documents make it seem like she’s not done yet. When a lawyer from New Sunshine asks where Melania gets her ideas, she replies: "I have ideas that I put from my dreams, from my head, to the paper… It was always there." Feature [What Really Goes Into Celebrity Closet Sales] [Kendall Jenner] This morning at 10 a.m. (7 a.m. PST), more than 200 handbags, shoes, tops, and bottoms previously owned by the Kardashians [went on sale] on the popular luxury consignment website [The Real Real], many for under $100. That means you — a normal who doesn’t even have their [own line of merch for their bespoke emoji] — can purchase and wear the same crop top that once cropped the top-half of Kylie Jenner. How does it all go down? We asked The Real Real senior director of marketing communications Nancy Alonzo, who told us that contrary to our expectations, it actually works pretty much the same way as it does when you attempt to consign your decade-old H&M skirt at [Buffalo Exchange] (just with far fancier and way more expensive items). [Read More >>] Ad from our sponsor From around the web A selection from the editors at Racked [alt text here] [Nearly 90,000 People Waiting in Virtual Lilly Pulitzer Line] Ain't no line like a Lilly Pulitzer line! [Read More] [Fluid images] [Manhattan’s Newest Mall Is Worth the Trip Downtown] It's stunning. [Read More] Ad from our sponsor [Facebook] [Twitter] [Instagram] [Change your preferences] or [unsubscribe]. Sent to {EMAIL}. For advertising, please visit our media kit or contact sales@racked.com. Vox Media, racked attn, 104 W. 40th St., 10th Floor, New York NY 10018. Copyright © 2016. All rights reserved.