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Macy's sues Martha Stewart Living over J.C. Penney deal

January 23, 2012|By Shan Li
  • Martha Stewart products are on display at a Macy's store in Cincinnati.
Martha Stewart products are on display at a Macy's store in Cincinnati. (Al Behrman / Associated…)

Department store giant Macy'sis going to court to block Martha Stewart Living's new deal with rivalJ.C. Penney.

In a suit filed Monday in New York State Supreme Court, Macy’s alleged that the deal, which will bring Martha Stewart products to Penney stores by early next year, violates a previous agreement handingMacy'sexclusive rights to sell certain branded products in its stores, Bloomberg reported.

J.C. Penneyspent $38.5 million last December acquiring a 16.6% share of the company founded by lifestyle guru Martha Stewart. Penney also inked a 10-year agreement to set up Martha Stewart mini-shops to peddle housewares within its own department stores.

However, Macy’s recently extended its deal with Martha Stewart Living to exclusively sell its branded products in categories such as cookware, kitchen utensils, and bed and bath items, Macy’s spokesman Jim Sluzewski said in an email. The current deal expires in January 2018.

Under the agreement, “the right for Macy’s to sell product exclusively in these categories was clearly defined,” Sluzewski said.

“Macy's plans to fully support its exclusive Martha Stewart-branded product,” he added.

Jeanne Meyer, a spokeswoman with Martha Stewart Living, declined to comment on the litigation. However, she confirmed that Macy’s notified the company about extending the agreement to sell Martha Stewart home goods in its department stores.  

Meyer said that J.C. Penney’s commercial agreement with Martha Stewart Living “is intact” and that the multimillion-dollar investment has also been completed.

“We believe that it’s good for our brand, for our partners and for our consumers to make our products available in a wide range of top retail locations,” Meyer said.

[Updated: A previous version of the post incorrectly stated that J. C. Penney spent $38.5 billion to acquire a stake in Martha Stewart Living. The amount was $38.5 million.]

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