Bloomberg News

Macy’s Sues Martha Stewart Living to Enforce Exclusivity Accord

January 24, 2012

Jan. 24 (Bloomberg) -- Macy’s Inc. is seeking in court to enforce an agreement with Martha Stewart Living Omnimedia Inc. allowing the department store chain exclusive rights to sell certain Martha Stewart-branded products.

The retailer filed a complaint in New York State Supreme Court in Manhattan yesterday aimed at stopping New York-based Martha Stewart Living from executing a new sales agreement with J.C. Penney Co., according to court documents.

Macy’s, based in Cincinatti, renewed a 2006 agreement for Martha Stewart-branded products, such as cookware, kitchen utensils and bed and bath items, for another five years, Jim Sluzewski, a spokesman for the retailer, said in an e-mail. It expires in January 2018, Sluzewski said.

The lawsuit seeks to enforce the agreement “in which the right for Macy’s to sell product exclusively in these categories was clearly outlined,” Sluzewski said.

“Macy’s plans to fully support its exclusive Martha Stewart-branded product going forward,” Sluzewski said. “Martha Stewart is among a wide range of leading brands offered in Macy’s home store and we will continue to expand and improve our home offering based on localized customer preferences across the country.”

Jeanne Meyer, a Martha Stewart Living spokeswoman, said in an e-mail that the company “typically doesn’t comment on legal matters.”

‘Transformational’ Partnership

J.C. Penney Co. Chief Executive Officer Ron Johnson, speaking in a Dec. 8 interview, said a partnership with Martha Stewart Living Omnimedia Inc. “will be transformational” for the department store chain.

J.C. Penney agreed to acquire a 17 percent stake in the housewares brand for $38.5 million, or $3.50 a share, according to a joint statement by both companies. The Plano, Texas-based department store chain is seeking to revive sales with new mini stores dedicated to the Martha Stewart Living brand.

The case is Macy’s Inc. v. Martha Stewart Living Omnimedia Inc., 650197/2012, New York State Supreme Court (Manhattan).

--With assistance from Cotten Timberlake in Washington. Editors: Fred Strasser, Mary Romano

To contact the reporters on this story: Chris Dolmetsch in New York at cdolmetsch@bloomberg.net; Patricia Hurtado in New York at pathurtado@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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