Retail Wars: Martha Stewart Is Back in Court Again

Domestic diva testified in a legal spat between Macy's and J.C. Penny over selling her product line.
5:50 | 03/07/13

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Transcript for Retail Wars: Martha Stewart Is Back in Court Again
Martha Stewart the -- on of all things domestic. Was in court again today -- two huge department stores may season JC Penney's. Are slugging it out about the right to sell her products. And as you'll see Stuart. Is his feisty as ever ABC's Dan Harris has more. -- she was one of America's most enigmatic and influential women -- yet again mobbed by cameras coming out of a courthouse in Manhattan. This time she was recording right back. I felt great -- It was classic Martha Stewart alternately -- -- it clumsy cameramen actually happening with the markets. -- refusing to answer questions. Getting annoyed when the body guards -- -- in the wrong car and then once again for good measure. -- I think at the photographer yeah. Nearly a decade after she was convicted of lying to investigators about a stock trade today as shameful today. Stewart is back in the middle of a major court battle the latest fascinating chapter. And a career that keeps rising and falling like souffle. This is a big deal for Martha Stewart we're talking big dollars. And were also talking about her reputation. This time Stewart whose 71 is in the middle of a fight between two powerful suitors the heads of Macy's and JC Penney. It's gotten emotional Macy's chief executive Terry Lundgren choking up on the stand. Accusing Stewart of breaching a contract to sell her goods exclusively in his stores. The contrasts here are deliciously absurd this trial involves allegations of ruthless sharp elbowed business deals over such products as -- -- Stationary curtains and kitchen where. Martha Stuart has been accused of top business tactics right from the start of her storied career she worked as a model and started a catering business. And went on to build an empire best selling books bring that to a boil. -- council house where her daughter would later write a tell all book saying much of this domesticity was a facade. That at home there were no prepared foods in the fridge and sometimes no -- -- on Halloween. At the height of Stewart's powers. The debacle prosecutors' charging her with selling shares of flailing Biotech company imclone based on inside information. A woman worth hundreds of millions of dollars skirting -- -- to -- just forty grant. At first in this infamous CBS interview Stewart refused to talk about and I want to focus on my salad then she fought the charges. And lost -- and I'll be back. Five months in the -- for company's stock tanked and she told ABC's Cynthia McFadden in a Nightline interview. How much money did -- lose. -- -- -- -- -- Actually personally I want sure 500 million dollar -- probably more than a billion dollars course. So more than a billion dollar hasn't and if you add in what the company was worth. Absolutely. On -- shareholder company. Many thought she'd crumble in prison but no the other inmates called -- and -- And she became their informal spokesperson. We have design decorating over. Behind there but when she got out she counted and a -- it how does that. I don't think I was a broken woman -- a did what I had to do. And came back and a -- into a company that had not failed. Despite The Who wishes of some that it would was humiliated. Now. No. I was never humiliated. Terry Lundgren for Macy's says he played a huge part in resuscitating her -- By bringing her into a more upscale environment and Kmart. And where he'd been previously -- her -- He thought they were friends they even went to Haiti together he also thought they had an exclusive deal. But then he got a phone call from Stuart saying she was doing a separate deal with the CEO of JC Penney Ron Johnson. Fighting back tears on the stand Lungren said that call made him sick to his stomach. Which she took the stand this week Stewart said she did not believe she broke her contract when Macy's. Quote it just boggles my mind that we're sitting here in front of you judge. JC Penney which is also being sued -- -- naturally agrees with Martha Stewart here ultimately a judge will decide. That -- and published in a winner -- here I think the court will ultimately rule that some of what she's trying to sell it JC Penney. Is covered by her contract at Macy's and as a result that she can't do it but not all. Really -- for Stewart may be ten her image sustain another hit. Some experts say sure she made it. Through going to prison can she may get through being accused. You know having really sharp belts. Yeah I think people used to think that mark that was nice. And I think they've gotten over that he's somebody who -- Iowa authority they trust. Was aesthetics they admire that I think is the retail appeals are less about her individual qualities. Still if Martha's -- was hoping to use her testimony to see more relatable there was at least one miss debt. When asked whether customers would be willing to buy her products from two stores at the same time he said and I quote. They might have two houses. Or Nightline this is Dan Harris. In New York.

This transcript has been automatically generated and may not be 100% accurate.

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