Macy's Sues Martha Stewart Living Omnimedia Over JC Penney Pact

In Suit, Retailer Says It Has Exclusive Right to Martha Stewart Products in Certain Categories

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Macy's Inc. is suing Martha Stewart Living Omnimedia over a plan to sell Martha Stewart-branded products in JC Penney stores.

J.C. Penney Co.agreed last month to open ministores selling Martha Stewart home and lifestyle merchandise within its retail outlets around the country, part of a deal to buy a 17% stake in Martha Stewart Living Omnimedia for $38.5 million.

But Macy's has an exclusive agreement to sell Martha Stewart-branded products such as cookware and bed and bath items through 2018, according to Jim Sluzewski, a spokesman for the retailer. Macy's has consistently used Ms. Stewart in its TV advertising and promotions, and features dedicated Martha Stewart content on its website.

The Macy's lawsuit, filed New York State Supreme Court in Manhattan on Monday, seeks to enforce its agreement "in which the right for Macy's to sell product exclusively in these categories was clearly outlined," Mr. Sluzewski said in an email.

"Macy's plans to fully support its exclusive Martha Stewart-branded product going forward," Mr. 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."

Martha Stewart CEO Lisa Gersh said last month that the JC Penney deal should not hurt its relationship with Macy's , pointing out that marketers such as Apple sell their products in multiple venues. "We think this is a great opportunity for all our partners," she said. "It's no different than many, many retail strategies, including the Apple strategy. You can go to an Apple store and enjoy those, but you can also get those products at Best Buy and Target ."

-- Bloomberg News --

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