Footwear e-commerce company Shoemagoo LLC isn’t happy with Nasty Gal Inc. and has gone to a judge for resolution.
The e-commerce company, which is subleasing space in Nasty Gal’s Kentucky warehouse, filed an emergency motion in bankruptcy court late Wednesday in hopes of having a judge enforce terms of its sublease.
Shoemagoo alleges in a court filing that it was locked out of its space last month and was also unable to access power and Wi-Fi, which has caused the company to cease operations. “With every passing hour that it is unable to operate, Shoemagoo is losing money and risks being put out of business permanently,” the company said in its filing.
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Shoemagoo, which is based in Chula Vista, Calif., inked a sublease with Nasty Gal in late October. The agreement included use of a 2,500-square-foot photo studio, along with warehouse space totaling 15,000 square feet in the first month and increasing by 5,000 square feet every month thereafter until it reached 30,000 square feet. The deal also came with all utilities.
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Nasty Gal, according to court documents, had apparently not informed its landlord, industrial real estate firm Prologis, that it was renting out part of its space.
Shoemagoo president Steven Maman claimed Nasty Gal promised “high-level management expertise” and shipping services through United Parcel Services to the footwear company at its facility. None of that was ever documented in a formal agreement.
According to Maman, such management expertise was not provided, causing the executive to move from California to Kentucky “to keep the operation from falling apart.” Court documents also said Shoemagoo executives were shocked to hear of Nasty Gal’s bankruptcy filing days after the company had moved into the Kentucky facility.
The company said it stopped paying rent to Nasty Gal in January and while it has since offered to pay, the company claims Nasty Gal is now asking for $200,000. Discussions broke down and the company was locked out of the premises for 24 hours last month and continues to not be able to access the Internet.
Shoemagoo, for its part, said it plans to vacate the facility within 60 to 90 days saying Nasty Gal’s “self-help remedies” are unlawful and fail “to act in an honorable or professional manner.”
A hearing on the emergency motion has been set for Thursday morning. That’s the same day bids are due for Nasty Gal. Manchester-based fast-fashion e-tailer Boohoo.com plc has the stalking horse bid for the company’s intellectual property and customer data, set at a $20 million purchase offer. Qualified bids that come in Thursday would send Nasty Gal into an auction to be held next week.