LOS ANGELES — May Department Stores Co. is the target of a $2.1 million lawsuit alleging fraudulent and unfair business practices by one of its vendors, which also seeks $100 million in disgorgement, or the surrender of profits as compensation.

In the suit, filed here in federal court last month, Cheong Tai International Holdings Ltd. is seeking a $1.2 million payment on goods it manufactured and shipped in June and July to U.S. May stores that were preapproved by May International employees at Cheong’s factories. A declaration filed Aug. 5 by Cheong Tai managing director Irene Tang states the vendor received a re-order e-mail from May International noting one of the styles for the ordered goods had “sold extremely well.”

Cheong is also seeking the return of $900,000 that it paid in chargebacks to the $13.5 billion retailer in April. At the next level, Cheong is looking for injunctive relief against May and wants a court order to pay $100 million to vendors who’ve had unfair dealings with May.

A $100 million garment manufacturer, Cheong Tai has had a 20-year relationship with May, according to the vendor’s attorney, Andrew Jablon from Resch Polster Alpert & Berger LLP.

“We believe because of this history, we had to take immediate action,” he said. A hearing is set for Aug. 26 on Cheong’s application for a writ of attachment worth $1.2 million.

May officials did not return calls for comment.

To Read the Full Article
SUBSCRIBE NOW

Tap into our Global Network

Of Industry Leaders and Designers

load comments
blog comments powered by Disqus