A ten-figure deal to sell more than 100 JCPenney stores has devolved into a high-stakes legal fight, with buyer Onyx Partners accusing the seller, the Copper Property trust, of deliberately sabotaging the transaction so it could chase a higher price elsewhere.
In a lawsuit filed last week in Manhattan Supreme Court, Onyx claims the trust breached its contract and acted in bad faith to kill the sale of 119 store properties worth $947 million, alleging the seller secretly shopped the portfolio to other buyers and blocked closing by refusing to deliver a required tenant estoppel certificate.
An estoppel certificate is a signed statement from the tenant confirming the key terms of its lease and whether any disputes exist, and the deal required a “clean” version from JCPenney to close — something Onyx alleges the trust failed to secure and then used as a pretext to derail the sale.
The suit says the trust repeatedly refused to extend the closing deadline — despite having done so before — after JCPenney issued what Onyx calls a “dirty” estoppel asserting the landlord had violated the lease, a problem the buyer claims was created by the seller’s own conduct and then weaponized to scuttle the deal.
Onyx claims the trust also violated a no-shop clause in the contract by marketing the properties to other buyers during the pre-closing period, telling the buyer on multiple occasions that the portfolio was worth “far more” than the agreed-upon price and that interest from other bidders was mounting.
The lawsuit states Onyx spent millions of dollars preparing for the closing — including lining up financing and entering into forward sale agreements for dozens of the stores — only to be left empty-handed when the trust refused to cure the alleged defects or push the deal across the finish line.
Onyx is asking the court to order the trust to complete the sale as originally agreed or, failing that, to award damages of at least $200 million, turning what had been billed as a landmark real estate transaction into a courtroom showdown over alleged bad faith.
The Post has sought comment from Onyx and Copper Property.
The deal traces back to JCPenney’s Chapter 11 bankruptcy in 2020, which led to the creation of the Copper Property CTL Pass Through Trust to liquidate the retailer’s real estate.
In July, the trust announced it had struck a $947 million all-cash agreement with Boston-based Onyx Partners to sell 119 store properties, with a closing initially expected in September.
That deadline was later pushed back as the trust raced to meet court-mandated liquidation requirements.
As the closing approached, some trust investors raised concerns that the per-store price was lower than in previous Copper Property sales, while executives stressed the urgency of completing the transaction.
Last week, the trust disclosed in a regulatory filing that the sale failed to close ahead of a Friday termination deadline, officially killing the deal.
The collapse left the trust under pressure to find another buyer before its Jan. 30, 2026 liquidation deadline, even as JCPenney continues operating the stores as a tenant.
“Any potential real estate transaction between Copper Property and Onyx Partners Ltd. would purely represent a transfer between parties as property owner and landlord to JCPenney,” the chain’s parent company Catalyst Brands told The Post on Friday.
“It does not impact JCPenney store locations or operations. These 119 JCPenney stores will continue to operate and serve our loyal customers and communities.”
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