Ross Stores Inc. sued for unpaid rent

As many states and cities are still on lockdown from coronavirus, it has halted the revenue that brick-and-mortar stores take in. When you aren't producing any revenue, that means no money for your bills, including rent. Thus, Ross Stores Inc. has now been sued for 5.5 million dollars in unpaid rent.

Ross' landlord has filed a lawsuit against the apparel retailer in federal court in Florida saying that the impact of the coronavirus fallout isn't enough for Ross not to pay their rent. Palm Springs Miles Associates Ltd. said it recognizes the challenges that COVID-19 posts, but that isn't an excuse for Ross not to pay its rent on three of its stores in Lake Worth, Florida according to the terms of its lease agreement.

There is a force majeure provision in Ross' lease, but Palm Springs Miles Associates says that in this case it does not apply. Ross' lease agreement was breached when rent was not paid on May 1, and they have said their non payments will continue as a result of the coronavirus crisis.

In mid-March Ross shuttered all of its stores. Originally, the company had hoped to have all of their stores reopened by April 4, but the majority of states had lockdown orders that extended through most of April. Several states have begun reopening and allowing retail stores to operate. Florida only just began its first phase of reopening, and retailers can only operate at 25 percent capacity.

To cut costs Ross has furloughed employees, although they are continuing to pay their health insurance. Palm Springs Associates asked a federal court judge in Florida to issue a declatory judgement that the force majeure provision doesn't excuse Ross from not paying rent during coronavirus and failure to pay is in violation of their lease agreement. Palm Springs Associates wants Ross to not only pay their rent, but the former's legal fees and interest on top of that.

Ross isn't the only store not paying rent right now. Gap Inc., H&M, Nordstrom, and Foot Locker all haven't paid rent. Unlike the other aforementioned companies, Ross doesn't sell products online, so they can't even count on e-commerce to soften the blow of lost brick-and-mortar sales and keep them afloat on some level. The retailer truly isn't taking in a dime on any front right now. We will see how this battle holds up in court.

photo: via rossstores.com