NEW YORK (TheStreet) -- Shares of Martha Stewart Living Omnimedia, Inc. (MSO) are trading down -3.65% to $3.96 on Tuesday afternoon following a Reuters report that a New York court has allow a lawsuit against the company to go through.
Age Group, a company that manufactures and licenses products for distribution, sued Martha Stewart Living last year for breach of contract and other claims.
In July 2009 Age Group entered into a four year licensing deal with Martha Stewart Living to market and sell pet products.
Four months later Age Group and PetSmart (PETM) made a deal that PetSmart would buy Stewart-brand pet products from Age.
The lawsuit claims Martha Stewart Living realized it undervalued Stewart-brand pet products and began withholding approval of pet products in order to get PetSmart to contact Martha Stewart Living directly, bypassing Age Group, Reuters reports.
On Monday a Manhattan Supreme Court Justice denied a request from Martha Stewart Living to dismiss the lawsuit.
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TheStreet Ratings team rates MARTHA STEWART LIVING OMNIMD as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate MARTHA STEWART LIVING OMNIMD (MSO) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we find that revenues have generally been declining."