LONDON, United Kingdom — On Thursday, LVMH announced plans to sue Tiffany, accusing the jeweller of defamation, misleading shareholders, and mismanaging the Covid-19 crisis, among other things.

The lawsuit is the latest twist in an increasingly acrimonious saga. LVMH's once-gilded plan to acquire Tiffany has devolved into an indecorous legal tit-for-tat.

On Wednesday, LVMH said it was calling off its $16 billion deal to buy Tiffany, which had been in doubt since the coronavirus pandemic derailed the trajectory of the luxury market. The jeweller responded with its own lawsuit, filed in Delaware, in which it accused the luxury conglomerate of dragging its feet on regulatory approvals in a bid to negotiate a lower price.

LVMH plans to vigorously deny this charge in its countersuit, the company said Thursday. It’s also alleging that Tiffany handled the financial fallout from the coronavirus pandemic poorly, potentially giving it another get out from the deal.

“Tiffany did not follow an ordinary course of business, notably in distributing substantial dividends when the company was loss making and that the operation and organisation of this company are not substantially intact,” LVMH said in a statement. “The first half results and its perspectives for 2020 are very disappointing, and significantly inferior to those of comparable brands of the LVMH Group during this period.”

Tiffany did not immediately respond to a request for comment, but the company defended its financial performance in a statement Wednesday. At the same time, it accused LVMH of “baseless, opportunistic attempts to use the US social justice protests and the COVID-19 pandemic to avoid paying the agreed price for Tiffany shares.”

The public tit-for-tat is unusual high drama in the normally discrete world of corporate luxury. Still, in a sign that there may yet be hope for the beleaguered deal, LVMH said it is still proceeding with plans to file for regulatory approvals from Brussels.

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Disclosure: LVMH is part of a group of investors who, together, hold a minority interest in The Business of Fashion. All investors have signed shareholders’ documentation guaranteeing BoF’s complete editorial independence.