For Molly Tea, 2026 was supposed to be the year of global coronation. Instead, the 'Oriental fragrance' tea chain has found itself entangled in a high-profile legal defeat against Louis Vuitton Malletier (LV) and a bitter public fallout with its North American partners. A Suzhou court recently ordered the brand to pay 10.3 million RMB in damages for trademark infringement, ruling that its four-leaf clover logo was too close a match for LV’s iconic luxury motifs.
The brand, which skyrocketed to fame on a platform of 'Oriental scents' and premium positioning, has been forced to scrub its primary visual identity across six major digital platforms. While the company has vowed to appeal, the public optics are damaging. In a move that trended on Chinese social media, Molly Tea recently swapped its minimalist black logo for a multi-colored version, a shift that analysts interpret as a desperate pivot to avoid further legal scrutiny while maintaining brand recognition.
Founded in 2020, Molly Tea successfully carved out a niche by focusing on jasmine and floral-infused teas, a departure from the fruit-heavy strategies of competitors like HeyTea. This strategy paid off handsomely in the short term, with the company reporting revenues of approximately 4 billion RMB in 2025 and expanding its footprint to nearly 2,500 stores. However, this rapid scaling appears to have outpaced its legal and operational safeguards, leading to the current crisis.
Beyond its domestic legal woes, the brand’s international ambitions are hitting a wall of mistrust. In June 2026, Molly Tea issued a stern notice terminating its relationship with several New York-based franchisees, citing 'serious breaches of contract.' The brand effectively shuttered high-profile locations in Flushing and Chinatown, sparking a counter-offensive from its former partners who accuse the corporate headquarters of 'burning the bridge after crossing it' to seize control of profitable stores.
The disputes in the United States center on shifting equity demands. Former partners allege that after they took the initial risks to establish the brand in the competitive New York market, headquarters attempted to force through new shareholder agreements that would significantly increase the parent company's ownership stake. This 'growth at any cost' mentality has turned a promising international expansion into a series of localized legal battles, threatening the brand's reputation among potential global investors.