NEW YORK (CNN/Money) -
The online unit of Toys "R" Us Inc. is suing Amazon.com Inc., saying it is violating Toysrus.com's contract to be the exclusive seller of toys and baby products on Amazon.com.
According to a statement from Toys "R" Us, Amazon is not honoring a 10-year exclusive contract with Toysrus.com. Under the deal, any time a consumer searches for a toy, game or baby product on Amazon.com, the search will be automatically redirected to the product on Toysrus.com's Web site.
In the complaint filed in a state court in Paterson, N.J., Toys "R" Us alleges that Amazon is permitting third parties to sell products that should only be sold by Toys "R" Us.
In the complaint, Toys "R" Us said it paid more than $200 million to be Amazon's exclusive dealer of toys, games and baby products.
"We expect Amazon.com to respect its contract with us and to support our position especially since we pay a very high fee to maintain this exclusivity," David Schwartz, senior vice president and general counsel for Toys "R" Us, said in a statement.
Amazon said the lawsuit would fail.
"We are relentlessly focused on increasing selection for customers consistent with our contractual commitments. Among other things, we believe we can have multiple sellers in the toy category, increase selection, and offer products that (Toys "R" Us) doesn't have," Amazon.com said in a statement.
"We believe that the allegations made by (Toys "R" Us) are without merit, however we cannot comment further on pending litigation."
The suit did not specify an amount of damages being sought.
Toys "R" Us (TOY: up $0.27 to $15.38, Research, Estimates) shares jumped nearly 2 percent in late-afternoon trading on the NYSE.
Amazon (AMZN: up $0.56 to $41.73, Research, Estimates) shares rose 1.2 percent late in the afternoon on Nasdaq.