Department stores these days are doing everything they can to earn the business of their customers, and one of the more recognizable figures in home goods in now at the center of a dispute between two big retailers. Martha Stewart Living has long had an exclusive contract with Macy's to sell its wares in their stores. This deal prevented Martha Stewart Living from selling its items in a competitor store, such as J.C. Penney. However, that's exactly what the domestic doyenne and her company now want to do.
It appears that Stewart and her company are trying to get around the language in the 5-year-old contract with Macy's that prevents its items to be offered for sale at one of Macy's competitors. The company's plan is to create specialty stores within J.C. Penney, thus not technically violating the contract. However, this is not satisfactory to Macy's and they filed suit last month to stop the deal from going through.
It may be that J.C. Penney knew a suit was likely and found the business so lucrative that it was willing to cough up money for a settlement in order to attract Stewart. For her part, Stewart would like to give a bump to her company, which has suffered in recent years. J.C. Penney would buy 17 percent of Martha Stewart Living, giving it an up-front infusion of cash.
Businesses in New Jersey that are involved with contract disputes are often well served by having the services of an experienced business litigation attorney on their side.
Source: Bloomberg, "Macy's May Settle Suit, Lose Martha Steward Living Brand to Penney: Retail," Cotten Timberlake and Chris Dolmetsch, Feb. 7, 2012