MSLO and Macy’s will meet in court to settle their conflicting assessments of Martha’s new J.C. Penney partnership and its impact on Martha’s existing partnership with Macy’s. Regardless of the outcome, Martha will launch her “store within a store” partnership with J.C. Penney in Spring 2013. The lawsuit will simply determine what products are offered there, as well as what brand name will appear on these products. Macy’s argues that the J.C. Penney partnership harms the competitive advantage they enjoy from having the exclusive rights to sell Martha Stewart household items, while MSLO argues that Macy’s has not been merchandising Martha Stewart items in good faith. MSLO claims that Macy’s advertises Martha Stewart items in order to attract customers, who then find Macy’s house brands, which are more profitable for the company, better merchandised and more plentifully stocked. Go, Martha, go!
Macy’s Inc.’s bid to prevent Martha Stewart Living Omnimedia Inc. from executing a sales agreement with J.C. Penney Co. is set to go to trial Feb. 19.
The case won’t be tried before a jury and there will be no need to decide damages, Judge Jeffrey K. Oing said today in New York state court in Manhattan.
Any potential damages in the dispute “are going to pale in comparison to the injunction,” Oing said during a hearing. “That’s the real big bucks there — if I stop this deal.”