The details of the settlement were not publicly disclosed.
J.C. Penney announced the partnership with Martha Stewart Living Omnimedia in 2011 to sell her products in Penney’s stores.
Claiming that the deal was in breach of an exclusive licensing agreement, Macy’s sued Martha Stewart Living Omnimedia in January 2012.
Later that year, Macy’s sued J.C. Penney for allegedly interfering with its licensing contact. That complaint alleged that Macy’s “took a risk” in 2005 when it agreed to exclusively license Martha Stewart trademarks because Stewart had recently been released from prison and Kmart, her company’s main merchandising partner, had merged with Sears.
“J.C. Penney knew that Macy’s exclusive licensing agreement with MSLO gave Macy’s a competitive advantage in the marketplace,” the complaint stated.
“The exclusive availability of a wide variety of Martha Stewart-branded home products at Macy’s brought foot traffic into Macy’s stores, where customers would then shop for other items as well. J.C. Penney wanted the ‘Martha Stewart’ name to do for it what that name does, and has done, for Macy’s. More importantly, J.C. Penney wanted to rob Macy’s of market share and destroy the competitive advantage that it enjoys as a result of its existing exclusive arrangement with MSLO. Indeed, after causing MSLO to breach the Macy’s Agreement, J.C. Penney admitted its tortious intent to the Wall Street Journal; its new CEO stated that ‘chains just need to share,’ and that, although ‘”[a] lot of retailers through the years have fought for exclusivity,”‘ ‘”there are certain brands [like Martha Stewart’s] that should be available broadly.”‘” (Brackets in complaint, which cites the Wall Street Journal story, “Martha’s Deal Miffs Macy’s,” published on Dec. 8, 2011.)
On Thursday, Stewart’s company said it settled the lawsuit with Macy’s. The companies said the details of the settlement were confidential and not material to either company, Reuters reported.
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