RTW Retailwinds inks settlement of Spooky collection license dispute

By Caroline Salls

Pittsburgh, Aug. 25 – RTW Retailwinds, Inc. requested court approval of a settlement that resolves a licensing and spokesperson agreement claims dispute with Spooky, Inc., according to a motion filed Monday with the U.S. Bankruptcy Court for the District of New Jersey.

Lerner, Inc. is also a party to the licensing and spokesperson agreement.

Under that agreement, Lerner may license, manufacture and sell women’s apparel bearing Spooky’s intellectual property.

RTW said it intends to sell its eCommerce businesses, which includes Spooky collection merchandise. In addition, the company sought approval to reject the licensing and spokesperson agreement.

RTW claims it is entitled to complete the manufacturing and sale of the merchandise for a six-month sell-off period, but Spooky said the sell-off rights cannot be enforced without its consent.

Under the proposed settlement, the license will be deemed rejected, effective July 31.

In exchange for the six-month sell-off period, Spooky will get a 5% royalty payment. Spooky will also be paid a $250,000 rejection damages fee in consideration for its consent to the sell-off period.

Also, Spooky will have a $2 million general unsecured claim against RTW in connection with rejection of the license.

A hearing is scheduled for Sept. 23.

RTW is a New York-based retailer of women’s apparel. It filed bankruptcy on July 13 under Chapter 11 case number 20-18445.

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