Alex and Ani Claims That Sterling Breached Contract

Alex and Ani has fired back against the lawsuit Sterling Jewelers filed against it in December, claiming that Sterling deliberately breached its contract with the charm maker.

In August 2015, Sterling—which had seen success selling Pandora at Jared—agreed to sell Alex and Ani’s products in 108 of its Jared stores. But in a counterclaim filed Feb. 5 in Ohio federal court, the Providence, R.I.–based jewelry company said that Sterling undercut that agreement by selling the products online without authorization.

According to the counterclaim, Sterling, which owns the Kay and Jared chains, could only sell Alex and Ani products online if its products were in 90 percent of Jared’s stores. It never reached that benchmark, the filing said.

Even so, Sterling started selling the charms on Jared.com, as well as at sister chains Kay Jewelers and Kay Jewelers Outlet, and on those stores’ websites, the filing said. Those sales “tarnished and devalued” the Alex and Ani brand, the filing argued.

Sterling eventually nixed the two parties’ agreement, “in an attempt to avoid the consequences of their breach of the agreements,” said Alex and Ani.

Alex and Ani’s countersuit claims breach of contract and seeks a declaratory judgment stopping Sterling from further unauthorized sales of Alex and Ani.

Sterling had claimed in its original suit that its deal with Alex and Ani did not allow it to use “certain discounting strategies,” causing the product to suffer at retail.  It said that Alex and Ani still owes it over $2 million for returned product.

The case was originally filed in Summit County, Ohio, court in November and then transferred to Ohio federal court a month later. Sterling has previously declined to comment on the suit, citing ongoing litigation.

 

JCK News Director


  • Name withheld

    Shocking that Sterling would cheat on its vendor!! This company has knocked off vendor displays, copied vendor merchandise, and has had a policy of eating vendor time and efforts.

  • Tarnish the Alex and Ani brand, you must be kidding.

  • Victor Kibalchich

    The last few of JCK’s online have reported on legal issues and law suits with no comment from Signet. The huge operation is in a box now. The new CEO is not a jewelry industry veteran. I predict a plethora of varied consultants with a silver bullet to solve Signets woes. Kay’s should be phased out beginning with underperforming stores. Jared’s should be the flagship retail stores and get in the value game the way Costco does. Get the internet to become Signet’s best friend NOW!

  • Susan Bruno

    As a retail store owner & jewelry designer, I find the biggest mistake that Alex & Ani made was to produce a product that looked like silver but was in fact base metal for way to much money. The audience the bangle charm bracelets was marketed to young people, teens & younger. The price point for these bangles was way over the budget of most young people. It was nice to own something fashionable but most parents & grandparents had to purchase them. Now the trend is fading because there are so many look alike in REAL STERLING at a better price point. I personally will pay $65.00 for Sterling but not for base metal. In conclusion, Alex & Ani are crying sour grapes because they are stuck with inventory. They should be happy Sterling Corp. even took the product in to begin with let alone sell the trending – fading fast bracelets on the internet.
    Boo Hoo!