World Tricot, a former textile supplier to Chanel, is to appeal against last week's judgment by a Paris court which threw out the lawsuit it brought against the luxury fashion house for copying one of its designs.

The case dates back to 2004 when World Tricot submitted a white crochet pattern to Chanel which the fashion brand rejected.

Several months later, the company's head, Carmen Colle, discovered the same design on a Chanel garment in a Tokyo store.

This triggered a EUR2.5m (US$3.7m) court action for alleged counterfeiting and breach of contract.

The Paris court condemned Chanel for breach of contract, awarding EUR400,000 in damages to the  eastern France-based firm, which Colle founded in 1980.

However, it also ordered World Tricot to pay EUR200,000 to Chanel for what it described as  a "smear campaign" against the group.

"It's been a long fight for justice. We've had a partial victory here as well as a reverse and we have resolved to carry on," Colle told just-style on Tuesday.

She said that since the loss of the Chanel contract four and a half years ago, World Tricot's fortunes have nose-dived. "Our workforce has been reduced to a dozen staff and the firm is in a very fragile state."

"While clearly we are acting as an individual firm on this, if this case can serve to help other textile suppliers in their relations with luxury goods customers all well and good," Colle added.

The appeal covers both the counterfeiting claim against Chanel and World Tricot's condemnation for the smear campaign, Colle confirmed.