Martha Stewart's company lost a bid on Thursday to dismiss Macy's Inc's claim that it violated their contract when it designed certain products for J.C. Penney Co Inc, even if the products do not carry the Martha Stewart brand.
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New York State Supreme Court Justice Jeffrey Oing's ruling may affect whether J.C. Penney can sell Martha Stewart-designed home goods in bedding, bath and cookware under a "JCP Everyday" label.
The judge is expected to rule on Friday on whether to temporarily block J.C. Penney's from selling Martha Stewart-designed goods that Penney's manufactured with "JCP Everyday" packaging.
A Citi analyst on Tuesday estimated the inventory already in a warehouse could be worth $100 million.
A preliminary injunction already in place bars J.C. Penney from selling Martha Stewart brand products in certain categories.