New York based department store Macy’s has filed a lawsuit against Martha Stewart Living Omnimedia to block a new licensing agreement with their middle America rival JCPenney. Macy’s asserts that the deal violates an exclusive Private Brand agreement with the retailer. As part of the contract, JCPenney would sell a line of Martha Stewart Private Brand home and kitchen items and launch Martha Stewart mini-stores within its stores in February 2013. The company also purchased a 16.6% stake in Martha Stewart Living for $38.5 million.
Macy’s has carried a line of Martha Stewart home and kitchen products since 2007. Macy’s said it was suing Martha Stewart Living for breaching its contract by creating a deal with JCPenney to sell items covered by the Macy’s agreement. The company said: “The right for Macy’s to sell products exclusively in these categories was clearly outlined.” Macy’s added that it renewed its contract with Martha Stewart Living for another five years, until January 2018. With the announcement of the JCPenney deal, Macy’s said it would review its Martha Stewart product range for “potential changes” in light of “the proliferation of Martha Stewart-branded product in the marketplace”.
All of this comes a short time after Ron Johnson, the former senior vice president of retail at Apple took the helm of the retailer as CEO and later hired former Target colleague Michael Francis, 48, as president.