Payment plans now available. Click here for more information.

Victoria’s Secret Just Filed Legal Paperwork To Break The Lease On Their Main Store. Can Small Business Owners Do The Same?

Patty Lamberti
Patty Lamberti Program Director
Patty Lamberti is the Program Director of Multimedia Journalism at Loyola University Chicago. She frequently writes about finances, the law and health.
  • Image by:
    StockSnap from Pixabay
Victoria's Secret Model in black t-shirt and bikini bottoms, breaking lease, small business

Victoria’s Secret already had a slew of financial problems before Covid-19 raced across America.


They had planned to close 25% of their stores nationally.


In early May, negotiations to sell a majority of their company to another firm fell through.


When the Coronavirus hit, Victoria’s Secret, like every retail operator, was forced to close all of their stores.


On May 26, Victoria’s Secret filed a  summons against the landlord of their flagship store in Manhattan


They are arguing that their $10 million lease should no longer be enforceable because the Coronavirus was an unforeseeable event that destroyed their business model. In legal terms, this argument is called "frustration of purpose," and could possibly be used to void a legal agreement.


If you own a store and are considering breaking your lease with a landlord, you may be wondering if you can try the same thing. Here’s what you should know:


More retailers will probably try to do something similar, but it’s unclear how courts will respond. 


Victoria’s Secret is the first major brand to try to legally break their lease. They technically filed a summons, which is a step lawyers take before officially filing a lawsuit. 


It says, “Because of the COVID-19 pandemic and Governor Cuomo’s ‘New York State on pause’ executive order (and related executive orders), the lease and guaranty are no longer enforceable under the frustration of purpose doctrine, as well as other common law doctrines and provisions of the lease and guaranty.”


Some see summons’ as a negotiating tactic, or a way to tell a landlord, “I mean business.” 


The landlord isn’t backing down. Their lawyer responded that the lingerie seller was simply “exploiting the current health and economic crisis.”


It remains to be seen how courts will respond to Victoria’s Secret. If you’d like to try something similar, it may be best to get an attorney to do the talking and writing for you. At Court Buddy, we can match you with an afford commercial lawyer


There are other options too. 


On May 19, Hertz simply wrote their landlords letters stating that they weren’t going to pay rent on any of their commercial spaces for six months. 


A few days later, they filed for bankruptcy.


Bankruptcy is a way for companies to get rid of some debt (like back rent), close some stores and restructure – without necessarily going out  of business.


J.Crew, for example, also filed for bankruptcy and won a court approval to defer its rent payments.


Talk to your landlord. 


Your first step should be to pick up the phone and talk to your landlord about possible options.


Many experts believe that commercial landlords, more so than residential landlords, are willing to work something out with business owners until stores can re-open.


After all, commercial landlords don’t exactly have a waiting list of new business owners waiting to take over the space. 


Play the prediction card. 


Remind your landlord that retail won’t look the same post Covid-19. 


The real estate research firm Green Street Advisors expects more than half of mall-based department stores to close by the end of 2021, leading to "excessive dark mall anchor space."


This prediction can help you negotiate with your landlord before you take any legal drastic steps.


If your landlord doesn’t work with you during this crisis, it hurts their pocketbook just as much as it will hurt yours. 


Remember, we’re always here to help if you need us. 


Legal Disclaimer

Court Buddy is here to connect you with an experienced and trusted lawyer who can help you at an affordable rate. The company assists with the management of your case and lawyer relationship. Your lawyer will assess your legal issue in a timely and confidential manner, explain why you need or do not need a lawyer, and only charge you for the legal services performed and associated out of pocket fees. This article is intended to convey general information and does not constitute legal advice.

Ready to get started? We’re here to help.

Related Blogs

  • Cassidy Chansirik
  • |
  • 07 July, 2020
ICE Announced That International Students Can Be Deported. What Does This Mean And Why Is It Happening?

Yesterday, the U.S. Immigration and Customs Enforcement (ICE) announced that international students enrolled in colleges that are offering online...

  • Trang Nguyen
  • |
  • 06 July, 2020
What To Do If Your Landlord Tries To Increase Your Rent When Eviction Moratoriums Expire

The CARES Act, passed in March, protected most renters from being evicted until July 25th (not all tenants are protected, however. It largely dep...

  • Sona Sulakian
  • |
  • 06 July, 2020
Laid Off Because Of COVID-19? In Some California Cities, Your Employer Must Consider Rehiring You.

In California, many people were laid off as the Coronavirus spread across the state. If you are one of them, you may be wondering what will happe...

  • Chris Wojcik
  • |
  • 03 July, 2020
4 Tips For Celebrating The 4th Of July During COVID-19

It's not a carefree 4th of July this year. Coronavirus cases are rising around the nation (and world), despite months of efforts to flatten t...

  • Niki Brown
  • |
  • 02 July, 2020
How To Golf And Fish Safely During Covid-19

As states re-open and warm weather prevails, you may be itching to to get back to golfing and fishing.  Across the nation, most golf cour...

  • Sona Sulakian
  • |
  • 02 July, 2020
Food And Bar Service Rules For Face Masks In California

The deteriorating COVID-19 situation in California has prompted Governor Gavin Newsom to order restaurants in 19 counties (including Los Angeles ...

Hablamos Español

Hablamos Español

Still have questions?

Call us toll-free at (866) 653-3017 to speak with a Client Success Specialist today.

Hablamos Español

Hablamos Español

Overall great experience from beginning to end! On the plus, I won my case!"

Overall great experience from beginning to end! On the plus, I won my case!"

Jonathan R, California

Court Buddy made it easy for me to handle my tough court case. I feel like I'm not alone."

Court Buddy made it easy for me to handle my tough court case. I feel like I'm not alone."

Silvia S, California