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Penney, Macy's court fight comes down to plastic pitchers

By Karen Freifeld

NEW YORK (Reuters) - The legal battle between Macy's and J.C. Penney over who gets to sell what Martha Stewart products took a comedic turn on Tuesday when lawyers asked a judge to weigh two pitchers in his hands, one from each of the rival retailers.

At stake is the question of whether Penney violated the judge's order not to sell certain Stewart products.

Macy's Inc lawyer Michael Platt placed the two tastefully designed plastic pitchers on the bench in front of Justice Jeffrey Oing in New York state Supreme Court in Manhattan.

One pitcher was from the Macy's Martha Stewart Collection, Platt said, the other from J.C. Penney Co Inc's label, Martha Stewart Celebrations. (The Macy's pitcher is $30 online, the Penney model $12).

"Pick them up," the Macy's lawyer urged the judge. "They are both made of plastic. They both weigh about the same."

The judge obliged, lifting one in each hand.

Macy's wanted the judge to order J.C. Penney to pull the pitcher from its shelves. It claims Penney violated a temporary order barring it from selling Martha Stewart-branded products in tableware, bedding, bath and other home product categories.

Oing issued the injunction last summer after Macy's sued J.C. Penney and Martha Stewart Living Omnimedia Inc over their plans to launch Martha Stewart boutiques in stores.

The deal was part of former Penney Chief Executive Ron Johnson's failed effort to reinvent the retailer. Johnson was ousted on Monday after sales declined 25 percent at J.C. Penney last year.

Macy's claims the domestic diva's J.C. Penney deal breaches its contract to exclusively sell certain categories of Martha Stewart products.

A non-jury trial in the battle over her home goods resumed this week after a month-long hiatus.

In addition to the pitchers, Macy's says it discovered over the weekend that Penney is selling a $10 set of champagne flutes and other Stewart-branded stemware that it allegedly should not.

Macy's said it found the disputed items on its rival's website and bought the pitcher at a J.C. Penney store in a New Jersey mall.

Mark Epstein, a lawyer for Penney, said he was looking into the matter.

The judge said he would not immediately rule on whether the items were being sold in violation of his preliminary injunction.

Ultimately, Oing said, if he decides Penney was not allowed to sell the items, Penney could be ordered to pay monetary damages to Macy's.

"Let's move on," the judge said Tuesday, after weighing the pitchers - and Penney's fate - in his hands for a second time.

(Reporting by Karen Freifeld. Editing by Andre Grenon)

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