Cherokee Inc. Announces That Mossimo Inc. Appeal is Denied by California Supreme Court.

Business Editors/Legal Writers

VAN NUYS, Calif.--(BUSINESS WIRE)--March 22, 2004

Cherokee Inc. (Nasdaq:CHKE) announced today that Mossimo, Inc.'s appeal to deny Cherokee its finder's fees under its March 28, 2000 finder's agreement has been denied by the California Supreme Court.

The denial of the appeal upholds a final arbitration award dated January 16, 2003, that awarded Cherokee all finder's fees that Mossimo had previously withheld, together with interest at the statutory rate and Cherokee's full attorneys' fees. This final arbitration award was previously confirmed by a Los Angeles Superior Court judgment dated June 17, 2003, which included the arbitration award amount plus interest at the statutory rate from January 16, 2003 to June 17, 2003. The Superior Court judgment also adjudged and decreed that Cherokee shall be entitled to receive from Mossimo 15% of all revenue received by Mossimo from Target Stores pursuant to Mossimo's March 28, 2000 licensing agreement with Target, and any extensions thereof.

The California Supreme Court's decision to not to review the trial court judgment reaffirms the validity of the original finder's agreement between Cherokee and Mossimo and Cherokee's right to be paid all amounts currently due, including interest at the legal rate and all post-judgment amounts as well as attorney's fees.

About Cherokee, Inc.

Cherokee Inc., based in Van Nuys, is a marketer, licensor and manager of a variety of brands it owns and represents. Currently, Cherokee has licensing agreements in a number of categories, including family apparel, fashion accessories and footwear, as well as home furnishings and recreational products. Some of Cherokee's premier clients around the world include Target Stores, Marshall Fields, Mervyn's, TJX Companies, Hearst Publications and Solara Capital (U.S.), Zellers (Canada), Carrefour (Europe), Tesco (U.K. & Ireland) and Shanghai Bolderway (China).

Statements included within this release that are not historical in nature, including our exploring alternatives, constitute forward-looking statements for the purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. When used, the words "anticipates," "believes," "estimates," "objective," "expects," "may," "likely," "should," "could," "possible," "plans," "goals" and similar expressions are intended to identify such forward-looking statements. In particular, the forward-looking statements in this news release include statements regarding the Company's goals for future growth in revenues, earning and dividends, the prospects of existing and new licensees such as Target Stores and Carrefour, and the Company's pursuit of additional licensing opportunities or brands to acquire or represent and the outcome of our dispute with Mossimo. Forward-looking statements involve known and unknown risks and uncertainties that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such risks and uncertainties, include, but are not limited to, the effect of national and regional economic conditions, the financial condition of the apparel industry and the retail industry, the overall level of consumer spending, the effect of intense competition in the industry in which the Company operates, adverse changes in licensee or consumer acceptance of products bearing the Company's brands as a result of fashion trends or otherwise, the ability and/or commitment of the Company's licensees to design, manufacture and market Cherokee and Sideout branded products, the Company's dependence on a single licensee for most of the Company's revenues, the Company's dependence on its key management personnel, and adverse determinations of claims, liabilities or litigations, including our dispute with Mossimo, and the effect of a breach or termination by the Company of the management agreement with the Company's CEO. A further list and description of these risks, uncertainties and other matters can be found in the Company's Annual Report on Form 10-K for Fiscal 2003, and in its periodic reports on Forms 10-Q and 8-K (if any). Undue reliance should not be placed on the forward-looking statements contained herein because some or all of them may turn out to be wrong. The Company disclaims any intent or obligation to update any of the forward-looking statements contained herein to reflect future events and developments.