Macy’s Inc. filed an appeal on Monday, challenging Manhattan state court judge Jeffrey Oing’s Friday ruling that J.C. Penney can sell unbranded Martha Stewart goods in its stores, at least temporarily.

New York State Supreme Court Justice Jeffrey Oing on Thursday refused to dismiss Macy's Inc's claim that Martha Stewart Living Omnimedia violated its contract when it designed certain merchandise for J.C. Penney Co., regardless of whether the items carry the Martha Stewart brand.

Macy’s and J.C. Penney are slated to be back in New York state court on Monday unless a last-minute settlement regarding Macy’s right – or not – to sell certain Martha Stewart products is reached.

The fight over Martha Stewart resumed with both Macy's and J.C. Penney Co. back in a New York court on Monday.

After nearly three weeks of testimony, a New York State Supreme Court Judge ordered Macy's, J.C. Penney Co. and Martha Stewart Living Omnimedia into mediation to try and reach a settlement in their contract dispute trial.

The current trial involving Martha Stewart, J.C. Penney Co. and Macy's could seriously damage the value of the Martha Stewart brand, according to litigation media relations and crisis management expert David Margulies, president of Marguilies Communications Group.

J.C. Penney Co. last Tuesday dominated the retail news as its shares dropped 10.6% to a four-year low after reports that one of its largest shareholders had sold a chunk of the troubled company’s stock.

A report by Reuters revealed that J.C. Penney CEO Ron Johnson was well aware that the retailer’s deal with Martha Stewart would step on Macy’s toes, but testified in court that the company decided to move forward anyway.

J.C. Penney will leave the Martha Stewart name off some of its upcoming décor and housewares lines despite the pair’s multi-million dollar partnership, according to a report by the New York Post.

New York State Supreme Court Justice Jeffrey Oing on Thursday denied Macy's Inc.’s attempt to block J.C. Penney Co. from proceeding with plans to sell a number of Martha Stewart Living Omnimedia home goods products in its stores.