MAY 9, 2004 - 18:43 ET

Danier Leather Inc. to Appeal Court Decision

TORONTO, ONTARIO--(CCNMatthews - May 9, 2004) - Danier Leather 
Inc. (TSX: DL) will appeal Friday's decision of the Superior 
Court of Justice (Ontario) finding for the plaintiffs in a class 
action suit against the Company and two of its Senior Officers. 
The case concerned the accuracy and disclosure of certain 
information contained in a financial forecast issued by the 
Company during its initial public offering ("IPO") in 1998. 

Edwin Hawken, Chairman of the Board of Danier Leather Inc., said, 
"We are all profoundly disappointed by this decision. The Court 
decision will be vigorously appealed on the basis that it 
contains errors of law that should be reversed. We will seek to 
bring the appeal forward as quickly as possible." 

The Judge concluded that Jeffrey Wortsman, President and Chief 
Executive Officer, and Bryan Tatoff, Senior Vice-President and 
Chief Financial Officer, had an honest belief at the time the IPO 
closed that the forecast prepared during that process could be 
achieved. The Judge further held that the forecast was, in fact, 
substantially achieved. However, the Court found that a proper 
review had not been done on the date of closing and had it been 
done the Company should have concluded that the forecasted 
results were not achievable. 

Mr. Hawken added, "The Board of Directors continues to have every 
confidence in Mr. Wortsman and Mr. Tatoff. Since the IPO they 
have guided the Company through significant growth and have 
clearly positioned Danier Leather as a leading retailer in its 

The Judge awarded damages to Canadian shareholders who purchased 
subordinate voting shares in the IPO. For those shareholders who 
sold their shares between June 4 and 9, 1998, the Court awarded 
them the difference between the IPO price and the price at which 
they sold their shares. For those shareholders who sold or still 
hold those shares after June 9, 1998, the Court awarded $2.35 per 
share. The Court stated that all damages should be paid 
regardless of whether the shareholders ultimately had a gain or 
loss on the disposition of their shares. 

Payment of any damages will be deferred as the award and the 
judgment will be stayed by the filing of the appeal. However, and 
based solely on the information currently available, if the award 
were paid today the Company estimates the damages to be about $10 
million. Interest and costs have not been dealt with by the Court 
but if awarded, the Company estimates the total award could 
increase by approximately $5 million. The judgment is a joint and 
several responsibility of the Company and its two Senior 
Officers. The Company carries directors and officers insurance 
and it expects that the insurance will cover the two Senior 
Officers' portion of the total award. 

The Company anticipates having sufficient financial resources to 
pay any award, interest, and costs. The Company has $24 million 
in cash, an increase of approximately $15 million from the same 
time last year. 

Jeffrey Wortsman, speaking for himself and Bryan Tatoff, said, 
"The IPO prospectus contained actual results for the first three 
quarters and a forecast for the final quarter. We then went on to 
achieve the results we had forecast. In short, we did what we 
said we would do." 

"Our business is sound and we recently reported increased sales 
and net earnings for the third quarter." 

"We look forward to being vindicated through the appeal process. 
In the meantime, we remain focused on the business, on meeting 
the needs of our customers and employees, and on creating value 
for our shareholders." 

About Danier 

Danier Leather Inc. is a leading integrated designer, 
manufacturer, and retailer of high-quality leather and suede 
clothing and accessories. The Company's merchandise is marketed 
exclusively under the well-known Danier brand name and is 
available only at its 101 shopping mall, street-front, and power 
centre stores, or through its corporate sales division and online 
through its website, 

Note: This press release may contain forward-looking statements 
that involve risks, estimates, and uncertainties. Therefore, 
actual results may differ materially. Examples of such risks and 
uncertainties include those associated with product sales, demand 
for Danier's products, availability of raw materials, foreign 
sourcing and manufacturing, estimates of damages, costs and 
interest associated with the class action lawsuit, continued 
growth of the leather apparel industry, and competition and other 
associated risks with Danier's business. For an expanded 
discussion of risks and uncertainties, please see the documents 
filed by Danier Leather Inc. with the Ontario Securities 
Commission and the Toronto Stock Exchange. Danier disclaims any 
responsibility to update or revise such forward-looking 
statements whether as a result of new information, future events 
or otherwise. 

Danier Leather Inc.
Jeffrey Wortsman
President and Chief Executive Officer
(416) 762-8175 ext. 302
(416) 762-7408 (FAX)


Danier Leather Inc.
Bryan Tatoff
Senior Vice-President and Chief Financial Officer
(416) 762-8175 ext. 328
(416) 762-6072 (FAX)