Sirie Palmos​, the director of online lingerie brand Hottie, has rejected compensation offers from Pacific Brands after Bonds named several styles in its 'New Era' range "Hottie". She is now considering filing a lawsuit against the Australian clothing and underwear giant for a breach of trademark.

Palmos' company Easton Corp Pty Ltd owns the registered trademark for the word and brand "Hottie" in Australia and New Zealand and has done so for the past decade. The trademark covers the classes of clothing, accessories, clothing and fashion design, web and digital design.

However, last month Ms Palmos was made aware that Pacific Brands had used the trademarked "Hottie" when she started fielding calls from customers inquiring if she had sold the Hottie brand to Bonds.

In August, Bonds ran a widespread marketing and public relations campaign featuring Australian-born international rapper Iggy Azalea to celebrate its 100th anniversary and promote its Bonds 'New Era' range, including the 'Boyfriend Hottie' and several 'Hipster Hottie' styles which were sold in Bonds stores as well as department stores including David Jones, Myer, Target and Big W.

Ms Palmos says the campaign has irreversibly damaged her decade-old brand.

"The repetitive reinforcement of branding by Pacific Brands and their retailers make it virtually impossible for Hottie to re-establish itself as the original maker of Hottie branded underwear.

"The established reputation and sheer size of Bonds and the manner in which it is bolstered by the largest clothing retailers in Australia make unilateral marketing by Hottie ... less effective, if not un-achievable," she said.

In early September, Ms Palmos rejected an initial compensation offer from Pacific Brands and last week she rejected a second offer.

"The offer is derisory and makes no real attempt to remedy the harm that has been caused to the Hottie brand."

Easton Corp is now considering filing a lawsuit against Pacific Brands, as well as some of Australia's biggest retailers, including David Jones, Myer, Target, Big W, Best and Less and Surfstitch.

"The infringement is acknowledged by Pacific Brands, but the manner in which they are attempting to push this aside is unbelievable harsh," Ms Palmos says.

She also believes the company may have acted unethically by trying to cover up the infringement.

"Bonds started to use cover-up stickers on top of the word Hottie (on swing tags) before I was aware of the infringement … I can only assume they didn't want Easton Corp to find out," she says. "If it was an error, then the ethical thing would have been to contact me and offer to license retroactively and apologise."

Bonds declined to respond to specific questions from Fairfax Media due to "pending legal proceedings" but a spokesperson for the brand issued the following statement.

"Following some incidental use of the word 'hottie' on a number of its Bonds branded products, Pacific Brands was made aware of an issue by Easton Corp. Upon being made aware of the issue, Pac Brands began working with its retailers and Easton Corp's lawyer to commercially resolve the concerns. Our aim is to come to a satisfactory outcome for both companies."

References to Bonds' 'Hottie' styles have been changed on the Bonds website to 'Hot' styles. Other retailers, including David Jones, have also removed references to the word 'Hottie' on Bonds products. However, some retailers including online clothing store Surfstitch are still selling and promoting Bonds 'Hottie' products.

In response to Fairfax Media's story, Surfstitch has since removed reference to the Bonds Hottie product from its website.

A spokesperson for Pacific Brands said while references to Bonds Hotties products still appear on Google searches it was "seeking to address the Google search issue."