J.C. Penney can sell unbranded Martha Stewart goods, for now

Fri Apr 12, 2013 5:59pm EDT
 
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By Karen Freifeld

NEW YORK (Reuters) - A New York judge on Friday handed embattled J.C. Penney Co Inc an interim victory in its dispute with Macy's Inc over goods designed by Martha Stewart.

But the judge said his ruling, which clears J.C. Penney to sell such goods as long as they don't carry the Martha Stewart name, was only a "bye" in the wider war. And he had harsh words for former J.C. Penney Chief Executive Ron Johnson, who he called the "architect" of the dispute.

The two national retailers are battling over the rights to sell Martha Stewart products in what are challenging times for department stores, especially J.C. Penney. Friday's ruling capped a week in which J.C. Penney ousted Johnson as chief executive and hired advisers to help it position itself financially.

Macy's claims it has the exclusive right to sell Martha Stewart goods in categories such as bedding, bath, and tableware, under a 2006 agreement that runs to 2018.

Macy's sued J.C. Penney and Stewart's company, Martha Stewart Living Omnimedia Inc, when they announced a partnership in December 2011.

Last year, Justice Jeffrey Oing blocked J.C. Penney from selling the disputed goods under a Martha Stewart label.

His ruling on Friday denied a request by Macy's to expand that ban to include products that would be branded "JCP Everyday."

Ted Grossman, a lawyer for Macy's, said he would appeal the ruling to prevent it from taking effect.   Continued...

 
A man with a Macy's bag walks past the J.C. Penney's store in New York, April 11, 2013. REUTERS/Brendan McDermid