Alex and Ani Files a Counterclaim in Sterling Suit

Akron, Ohio-- Alex and Ani has filed a counterclaim in response to the breach of contract lawsuit Sterling Jewelers filed against it last month alleging that Sterling is the one that violated their agreement.

Documents filed in federal court in Ohio show that both parties seem to agree on a couple of key points in the case: that Sterling would sell Alex & Ani at approximately 100 Jared the Galleria Jewelry stores beginning in August 2015, but not at any other Sterling-owned stores, including its outlet stores.

The Sterling suit alleges that Jared had difficulty selling the Alex and Ani product, and the aforementioned selling restrictions kept Sterling from being able to make any profit on items that wouldn’t sell.

Sterling said that after reaching an agreement in 2016 with Alex and Ani for the latter to buy back $3 million worth of product, it never received the money, despite sending a first shipment of product valued at $900,000.

At that point, Sterling terminated its agreement with Alex and Ani, and it admits to selling the remaining stock at Kay Jewelers, Kay Jewelers Outlet locations, and on Kay.Com, KayOutlet.com and Jared.com.

The Sterling suit asks for about $2.6 million in damages, plus interest and attorneys’ fees.

Alex and Ani’s counterclaim, filed against Sterling parent company Signet Jewelers Ltd. on Feb. 5 in U.S. District Court for the Northern District of Ohio, states that it limited where and how Alex and Ani could be sold through Sterling because it “is strategic and thoughtful with regard to where and how its products are sold, in order to maintain the integrity of the brand.”

On Aug. 26, it learned that Sterling was selling 459 of its bangle styles on Jared.com and on Aug. 30, Sterling terminated their agreements.

“It is apparent from the timing that Sterling terminated the agreements in an attempt to avoid the consequences of breach of the agreements,” the countersuit states.

Alex and Ani is alleging that Sterling’s conduct “was in breach of the contractual agreements between them” and is seeking to block any further sales through “unauthorized channels,” a dismissal of all claims against it and damages to be determined at trial, in addition to attorney’s fees.

Signet Jewelers affirmed it does not comment on ongoing litigation and a request for comment sent to Alex and Ani’s attorney, Mark Geragos, was not returned by press time.