A turf war is erupting between the largest department store in Manhattan and the world’s largest retailer over the rights to advertise on a Herald Square billboard, according to a lawsuit filed recently in state Supreme Court in Manhattan.
Macy’s is going after its landlord, Kaufman Realty, to block a pending deal with Amazon to use the billboard atop its flagship Herald Square store, claiming that ads from its competitor would cause “immeasurable” harm to its business, the complaint said.
The e-commerce giant raised eyebrows in August amid reports that it would open its own department stores in cities across the country. Critics saw the move as a blow to existing retail businesses.
Macy’s plans to stop Amazon in its tracks with an injunction to protect its business, which includes online sales.
“The damages to Macy’s customer goodwill, image, reputation and brand should a prominent online retailer (especially Amazon) advertise on the billboard are impossible to calculate,” the company stated in court papers.
The storied retailer had been advertising its own business on the billboard for more than 50 years, but when its lease was to expire in August, it failed to come to an agreement with its landlord, which was already in talks to lease the space to Amazon, the complaint said.
But in its original deal from 1963, Macy’s included a restriction that barred any retailer from advertising on the billboard forever. The landlord called that provision invalid, the company said in court papers.
“Macy’s continues to have rights relating to advertisements at that location,” company spokesman Orlando Veras said. “We expect to realize the benefits of these rights and have asked the court to protect them.”
Following the COVID-19 pandemic’s devastating effect on the city’s retail industry and years of declining sales in brick-and-mortar stores, New York City's surviving shops are on shaky ground. The Neiman Marcus outpost that opened at Hudson Yards closed a few months into the pandemic, but Macy’s recently unveiled plans to build an office tower above its Herald Square store and announced that it would spend $235 million to revitalize the surrounding neighborhood.
Representatives for Amazon and the Kaufman Organization did not immediately respond to requests for comment.
