Martha Stewart Living Files Counterclaims in Macy’s Suit Over J.C. Penney

Martha Stewart Living Omnimedia Inc. (MSO), sued last month by Macy’s Inc. over its deal to sell merchandise in J.C. Penney Co. stores, defended the agreement and filed counterclaims against Macy’s.

The agreement with J.C. Penney is permitted under an existing contract between Macy’s and Martha Stewart Living, the company said in a filing today in New York State Supreme Court in Manhattan.

“Macy’s simply has no exclusive right to MSLO’s creativity or design concepts, now or in the future,” Martha Stewart Living said.

Macy’s sued in January seeking to stop New York-based Martha Stewart Living from executing the J.C. Penney agreement. Macy’s, based in Cincinnati, claims its contract gives the retailer an exclusive right to sell Martha Stewart-branded products within certain categories.

In its filing today, Martha Stewart Living accused Macy’s of breach of contract, saying the retailer has stocked and priced Martha Stewart products in a manner that favors Macy’s own private-label brands.

“They have used Martha Stewart Collection products to draw customers into Macy’s Home Store, where its own private-label brands take center stage and, of course, generate higher profits for Macy’s without the burden of paying royalties,” the company said.

Jim Sluzewski, a Macy’s spokesman, declined to comment on the claims.

The case is Macy’s Inc. (M) v. Martha Stewart Living Omnimedia Inc., 650197/2012, New York State Supreme Court (Manhattan).

To contact the reporter on this story: David McLaughlin in New York at dmclaughlin9@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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