Saks Fifth Avenue illegally ordered Cartier to vacate a prime location inside its famous New York department store, according to a $40 million lawsuit Cartier filed last week.
The case revolves around a lease agreement that gave Cartier use of space inside Saks’s site on the corner of Fifth Avenue and 49th Street. Saks renovated the building earlier this year, and assured the tenant the works would not affect its lease, Cartier alleged in the October 3 complaint. Despite that, the landlord subsequently terminated the lease, the lawsuit claims.
Cartier specifically selected the site for its excellent location, and invested in renovating the space to suit its needs, the New York State Supreme Court filing states. It renewed the lease for five years in 2016.
Saks began remodeling the store this year, a move it had been planning for a long time. The renovations created “substantial challenges for Cartier,” including “significant dust and construction debris,” requiring much cleanup work by Cartier employees, which had an adverse effect on their health, the lawsuit alleged. The process also led to reduced customer traffic for Cartier, resulting in “significant damages,” it stated.
Prior to the remodeling, senior executives at Saks “repeatedly and consistently” assured Cartier it would respect the lease during the works and not displace the jeweler, according to the filing. However, on August 14, Saks sent a letter to Cartier terminating its lease agreement and requiring it to vacate the premises by October 13. Saks failed to find Cartier an acceptable alternative location, and promised the Cartier spot to another competing luxury brand following the completing of the renovations, Cartier said.
“Saks’s actions…were undertaken in bad faith, for the purpose of harassing Cartier and interfering with its ability to operate the Cartier department in the Cartier location, and constitute a breach of the covenant of good faith and fair dealing,” Cartier said.
Cartier claims Saks’s actions caused it more than $40 million in damages. The jeweler is seeking that amount from Saks, and has asked the court to stop the department store from terminating the lease, according to the filing.
Saks had not responded to a request for comment at press time.