Balenciaga Drops $25 Million Lawsuit Against Marketing Agency North Six

Balenciaga is tossing out its massive suit against a marketing agency that it claimed was to blame for its recent controversial photoshoots ... and instead is doing a 180, focusing on organizations that benefit the protection of kids.

President and CEO Cedric Charbit released a statement Friday on social media ... saying "Balenciaga has decided not to pursue legal action" -- ditching the $25M lawsuit against North Six from earlier this week.

Balenciaga instead seems to be pivoting from attack mode ... saying the company's "current process for content validation has failed" and adding it's going to be starting up an image board -- tasked with evaluating all aspects of content going forward.

The company says it's also working with an agency to better assess its projects, amongst other company-wide changes.

He says the company's put aside a "significant fund" for grants to go to orgs that benefit the protection of children ... ending by apologizing for what went down and adding Balenciaga doesn't tolerate "any kind of violence and hatred message."

As we reported, Balenciaga came under fire for a series of shoots -- one where children held BDSM-themed bears, and another featuring what appeared to be legal docs related to a Supreme Court case dealing with child pornography.

Balenciaga came for North Six, a company that was involved with one of the photoshoots, with the big lawsuit ... but a source connected to the shoot told us North Six wielded no creative power in the project and claimed it wasn't ultimately responsible for any harm to Balenciaga's reputation from the controversy.