Sephora not moving out of J.C. Penney

Sephora and J.C. Penney have patched up their differences.

The beauty giant and department store company have reaffirmed their partnership, ending a battle after Sephora threatened to end its current contract with Penney early and close its in-store shops in Penney stores. Sephora is Penney’s only beauty partner. There are about 600 in-store Sephora shops in Penney.

"Both companies worked constructively to resolve outstanding legal matters and have agreed to mutually beneficial revisions to their joint enterprise operating agreement," the companies said in a joint statement. “J.C. Penney and Sephora have worked together over the past 14 years to serve our customers and be relevant in an evolving retail landscape. Today’s amendment remains consistent with this shared goal and the companies are committed to continuing to expand and innovate SiJCP’s offerings in order to deliver the beauty experience customers expect in the future.”

Amid reports that it is considering a bankruptcy filing, Penney had filed a temporary restraining order alleging that the LVMH-owned beauty company had threatened to not reopen its in-store boutiques if Penney did not agree to ending Sephora’s current four-year contract early, The Dallas Morning News reported. Penney said in the filing that the loss of Sephora as a partner would cause “irreparable injury.” Sephora claimed Penney had breached its agreement when employees in the in-store shops were furloughed as stores closed due to the COVID-19 outbreak. 

Sephora pushed back, filing an emergency motion to dissolve the order it said is based on a “fanciful, one-sided narrative.”