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Judge: JC Penney interfered with Martha Stewart-Macy's deal

David Becker / Contributor | Getty Images Entertainment

J.C. Penney interfered with Macy's agreement with Martha Stewart Living Omnimedia, a New York judge ruled on Monday.

Justice Jeffrey Oing of New York state court referred the issue of damages to a referee or special hearing officer.

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But, he said in his written ruling, "Macy's failed to prove by 'clear, unequivocal and convincing evidence' that it is entitled to a punitive damage award."

Macy's sued Penney and Martha Stewart Living after the two announced a partnership in December 2011. Macy's said the agreement breached its contract with Martha Stewart that included exclusive rights to Martha Stewart-branded cookware, bedding and bath products.

Read More Martha Stewart: It's all about branding

In October, Penney and Martha Stewart Living announced a revised agreement that eliminated Stewart's products in home goods categories to which Macy's claimed exclusive rights.

—By Reuters

Read MoreMartha Stewart's JC Penney Deal Left Macy's CEO 'Sick'

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