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An appeals court in Mexico has overturned a $45 million judgment against Levi Strauss & Co., reversing a decision that held the jeans maker liable for a police raid that wrongly targeted a former contractor during a crackdown on clothing counterfeiters. The San Francisco-based company disclosed the ruling, reached earlier this week, in a Friday filing with the Securities and Exchange Commission. A lower court in March ordered Levi’s to pay Mexico City contractor Comexma $24.5 million in direct damages and another $20.5 million for harming the company’s reputation. Comexma sued Levi’s in the fallout from a June 2001 incident at its plant. Accompanied by local media, Mexican police raided Comexma looking for evidence of bogus Levi’s brands based on information provided by a company attorney. The brand-protection attorney set up the raid without getting the required company approvals, Levi’s said. Police backed off after Levi’s confirmed Comexma as an authorized manufacturer, but it came too late to prevent significant damages, the contractor alleged in a lawsuit filed in March 2002. Comexma closed the Mexico City plant after the raid. In this week’s decision, the appeals court concluded there wasn’t a direct link between the raid and plant closure, according to Friday’s SEC filing. Comexma can still seek a review of the appeals court ruling. Copyright 2005 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.

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