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Saks Strikes Back at Cartier with $55M Claim
Oct 8, 2018 9:41 AM
By Rapaport News
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RAPAPORT... Saks Fifth Avenue has filed a countersuit against Cartier
for $55 million, alleging its eviction of the jeweler was justified under the
terms of their contract.
Cartier sued Saks last week, claiming the
retail giant unlawfully evicted it from its space at the Saks flagship store at
the corner of Fifth Avenue and 49th Street. Cartier sought an injunction to
prevent its ouster, as well as $40 million in damages.
Cartier argued that Saks’s renovation of the site this year
had created significant challenges for the jeweler’s boutique, and the department
store had assured it the remodeling would not have any effect on the lease.
However, in a countersuit Saks filed Friday at the New York Supreme Court, it denied
wrongdoing, stating that it had never guaranteed Cartier the redesign would not
affect it in any way.
In addition, the deal between the two companies was not a
“lease” as described in Cartier’s original suit, Saks argued. It was actually a
“concession agreement” that allowed Cartier to operate a boutique on Saks’s
premises, according to the department store. The arrangement included a
provision that permitted Saks to terminate the contract following a “material
change” in its business model or “matrix,” it added. Saks’s $250 million
refurbishment of the site, which it began in May, had the purpose of transforming
it from a traditional department store to an experience-driven store. That
change in its model was substantial enough to warrant ending the Cartier agreement,
Saks insisted.
Saks also offered Cartier space in its new, exclusive
jewelry section, “The Vault,” which would also house other luxury brands including
Chopard and Graff Diamonds, and would provide consumers “a more private, secure
location for making very expensive purchases,” the suit continued.
“Saks recently embarked upon a complete reimagining and
renovation of the New York store and offered Cartier a prime location to
participate,” the suit states. “For reasons that remain a mystery, Cartier
declined.”
Furthermore, Cartier’s refusal to vacate the site will disturb
Saks’s plans to unveil its new ground-floor concept ahead of New York Fashion
Week in February, it noted.
Saks claimed Cartier’s actions would cost it more than $55
million in lost business. The department store is seeking that amount, as well
as a declaration from the court that its termination notice was valid,
requiring Cartier to vacate its Fifth Avenue store.
Image: Saks Fifth Avenue, Manhattan. (Northfoto/Shutterstock)
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Tags:
Cartier, Chopard, Graff Diamonds, New York Fashion Week, New York Supreme Court, Rapaport News, saks, Saks Fifth Avenue
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