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Lockdowns, Landlords, & Litigation: Abercrombie & Fitch Flips The Script on Simon Property Group Inc.

Client Alert
August 4, 2020

Novel litigation between commercial property owners and tenants arises from COVID-19 lockdowns. Typically, owners sue for nonpayment of rent. But in Franklin County, Ohio, a large retail tenant turned the tables and sued the owner to recoup payments.

Abercrombie & Fitch (A&F), Columbus-based apparel retailer, recently filed suit against one of the nation’s largest landlords, Simon Property Group Inc. A&F, which leases properties from Simon, alleges that Simon “wrongfully extracted” rent payments on those properties during the lockdowns that covered the nation. The amount of rent and number of stores impacted by the lawsuit is not disclosed, but according to public filings, A&F demands return of all rent payments to Simon during a specified period.

A&F essentially argues that it was not obligated to pay rent because it was locked out of its premises. More specifically, A&F argues that “the government-mandated closures amounted to ‘prohibitions’ under the terms of the lease agreements such that A&F was, and is, entitled to an abatement of any and all rent and other charges” during the lockdown. A&F maintains that Simon’s mere demand for payment during the lockdown constitutes a breach of contract, and any/all payments remitted were “under protest” and should be returned.  

Seeking to gain leverage by adopting an aggressive posture is a classic litigation technique that is now being applied in these unprecedented times. Whether the tactic will be fruitful depends on innumerable variables that begin with the contract language between the parties. Given the size and sophistication of the litigants, copycat actions and/or landmark precedents are likely to result.

For more information, please contact our Real Estate or Litigation teams.

To stay updated, please visit our Resources page regularly.

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Client Alert

January 2025 Notice of Proposed Rulemaking Brings Notable Changes to HIPAA Security Rule

February 25, 2025In January 2025, the U.S. Department of Health and Human Services proposed amendments to the HIPAA Security Rule, aiming to enhance cybersecurity for covered entities (CEs) and business associates (BAs). Key changes include mandatory compliance audits, workforce training, vulnerability scans, and risk assessments. Comments on the proposed rule are due by March 7, 2025.Client Alert

Corporate Transparency Act Effective Again

February 20, 2025The federal judiciary has issued multiple rulings on the enforceability of the Corporate Transparency Act (CTA), which took effect on January 1, 2024. Previously, enforcement was halted nationwide due to litigation in Smith v. U.S. Department of the Treasury. However, on February 18th, the court lifted the stay, reinstating the CTA’s reporting requirements. Non-exempt entities now have until March 21, 2025, to comply. Businesses should act promptly to avoid civil penalties of $591 per day and potential criminal liability.Client Alert

Status Update: Physician Noncompete Agreements in Ohio

February 11, 2025Noncompete agreements remain enforceable in Ohio if they meet specific legal requirements. While the AMA and FTC have challenged these restrictions, courts continue to uphold reasonable noncompete provisions for physicians. Recent cases, like MetroHealth System v. Khandelwal, highlight how courts may modify overly restrictive agreements to balance employer interests with patient care. With ongoing legal challenges to the FTC’s proposed ban, Ohio physicians should consult a healthcare attorney before signing or challenging a noncompete agreement.Client Alert

Immigration Orders and Their Economic Impact on Small Business: Insights from Attorney and Former Immigration Judge Rob Ratliff

January 30, 2025President Trump's recent executive orders, targeting immigration policies, could significantly impact small businesses in Ohio, particularly those owned by undocumented immigrants. With stricter visa vetting, halted refugee admissions, and potential deportations, these businesses face uncertainty, workforce disruption, and closures. Ohio's immigrant-owned businesses, especially in food services and transportation, contribute billions to the state economy, and any disruption could result in economic ripple effects.Client Alert

Corporate Transparency Act Ruling from the U.S. Supreme Court

January 24, 2025The U.S. Supreme Court recently ruled on the enforceability of the Corporate Transparency Act (CTA), lifting an injunction previously imposed by the Fifth Circuit. However, a separate nationwide injunction remains in effect, meaning businesses are still not required to comply with the CTA’s reporting requirements. FinCEN continues to accept voluntary reporting while enforcement remains paused.
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