Recently, a large retailer (plaintiff) and a bank (defendant)
agreed to settle a credit contract dispute. In April 2023, the retailer filed a
complaint in the U.S. District Court of the Southern District of New York against the bank regarding the termination of a contract under which the bank would issue branded credit cards for the retailer. The retailer claimed that the bank did not meet important contract requirements, and invoked its right to terminate. The bank denied the retailer’s termination right, prompting the retailer to seek a judicial declaration of its right to terminate the contract. According to the complaint, the contract required the bank to provide “carefully defined levels of service to [the retailer] and its customers.” The retailer claimed, however, that the bank failed to meet certain requirements, such as including mailing a credit card replacement to customers within five business days.
Earlier this year, the court granted partial summary judgement in favor of the retailer because the contract terms “clearly dictate that [the bank’s] repeated customer service failures entitled [the retailer] to invoke Termination Right and terminate the parties’ ongoing partnership.”
In a letter sent to the court, the parties indicated they have agreed to a settlement that will resolve the matter and concurrently filed a stipulation of voluntary dismissal with prejudice as to all claims and counterclaims.
