The Business Litigation Blog

Closing Arguments Heard in Macy's, J.C. Penney Martha Stewart Breach of Contract Debacle

A few months ago we wrote a blog post on Macy’s ongoing lawsuit against J.C. Penney over its contract with Stewart’s company, Martha Stewart Living Omnimedia. To read an overview of the timeline of events associated with the lawsuit, click here.

It seems that this long running lawsuit might finally come to a close. New York State Supreme Court Justice Jeffrey Oing heard final arguments Friday, nearly three months after the five week public trial.

In his closing argument Friday, the lawyer for J.C. Penney said that the ambiguity existent in the contract between Macy’s and MSLO is the factor that caused the dispute in the first place. Lawyers for Martha Stewart told the judge that Macy’s was no longer seeking bans on J.C .Penney’s sale of goods that do not bear the Martha Stewart brand, and instead will try to seek damages at a later trial.

According to lawyers for Macy’s, J.C. Penney’s contract with MSLO was an attempt to reap the benefits of Macy’s work with Stewart. The company entered into a contract with her directly following her release from prison and at a time when she was associated with K-Mart, a less upscale retailer; and looked for loopholes in the contract between MSLO and Macy’s.

Judge Oing assured all parties that an outcome would not be immediate as he would take the matter into careful consideration. The outcome of the lawsuit will certainly have an impact on Macy’s and J.C. Penney as both companies as home goods contribute significantly to their profits. As for Martha Stewart, whose company has been losing money for nearly ten years, being able to sell her products in both stores would mean a hopeful turnaround for her business.

There are many types of contract and certainly many ways to breach a contract. Whether or not lawyers for Macy’s were correct in their assessment that J.C. Penney searched for loopholes or not, it is important to consult with an attorney if you are unclear about a contract issue. The Patterson Law Firm is experienced in many forms of breach of contract. To learn more about our firm, visit pattersonlawfirm.com or call 312.223.1699.

 

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