A judge has forced Starbucks to keep running its failing Teavana stores in a chilling verdict for the retail industry (SBUX)

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December 4, 2017 7:46 PM

A mall operator argued that closing Teavana stores would trigger additional store closures.

But Simon Property Group, which operates malls around the country, sued Starbucks to keep it locked into its leases for the 77 Teavana stores in its malls.
A judge is now forcing Starbucks to keep those stores open in a decision that has chilling implications for retailers planning to close stores.

A judge is forcing Starbucks to keep 77 Teavana stores open in a ruling that has chilling implications for the retail industry, the New York Post reports.

Starbucks said in July that it planned to close all 379 stores in its tea-shop chain, which are primarily in shopping malls, by the end of the year, citing operating losses and declines in foot traffic.

But Simon Property Group, which operates malls around the country, sued Starbucks to keep it locked into its leases for the 77 Teavana stores in its malls.

Simon had argued that the closure of Teavana stores could trigger additional store closures in its malls at a time when shopping centers are under pressure from falling foot traffic and widespread retail bankruptcies.

The mall owner said it would be hit much harder financially by the closures than Starbucks would be if it were forced to keep its stores open until their leases expired.

An Indiana judge agreed, and now Starbucks will be forced to keep running the 77 Teavana stores, according to the Post.

The Post described industry experts as saying the decision has chilling implications for other retailers planning to close stores.

It has been a record year for store closures, with retailers shutting down more than 5,000 stores so far and putting more pressure on mall operators to fill vacancies.

As these mall operators become increasingly desperate to keep the lights on, many more retailers could find themselves in court, fighting to shut down dying stores.

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