Frustrated by leaky roofs, high vacancies and down-market tenants, Dillard's Inc. (DDS) is suing a Texas mall owned by Simon Property Group Inc. (SPG) and General Growth Properties Inc. (GGP) for neglect.

Although similar lawsuits have been filed before, they don't appear very common outside of bankruptcy proceedings. But that could change as many mall landlords have less cash to spend on maintenance and lack leverage to attract and retain desirable tenants.

Dillard's is asking the U.S. District Court, Western District of Texas, Austin Division, to void the lease of a Highland Mall store. The retailer in a court filing claimed the mall was allowed "to deteriorate in character and quality such that it is now approximately half vacant, has a poor tenant mix that is not consistent with a first-class shopping center operation."

The department store chain cited the closure of a J.C. Penny Co. (JCP) anchor and the emergence of discount retailers, including a new store that sold toilet paper, as contributing to a poor business environment. In addition, Dillard's says the mall was slack on ,maintenance including not repairing store damage caused by a leaky roof.

Dillard's may simply be a dissatisfied customer, but the retailer may also be in the forefront of a new strategy retailers may take to get out of their leases, said Dave Marcotte, director of Retail Insights, a retail consulting firm.

"This is not common yet," said Marcotte. "But it may be another shoe dropping - seeking legal remedies as an exit strategy."

The lawsuit comes at a time when mall landlords and retailers are struggling amid a brutal recession that has severly curtailed consumer spending, halted expansion and fueled massive store closings nationwide. The International Council of Shopping Centers has projected 73,000 store closures during the first half of this year.

A prolonged credit crunch has also hindered many mall owners from refinancing debt forcing them to conserve as much cash as possible to pay maturing loans.

General Growth, the second largest public U.S. mall operator after Simon Property, filed for bankruptcy Thursday as it crumbled under a $27 billion debt load.

The Dillard's lawsuit, filed in late March, shouldn't be impacted by the Chapter 11 since Highland Mall wasn't one of the affected properties.

Representatives from Dillard's and General Growth declined to comment, citing the matter being under litigation. Simon Property had no comment.

David Bruck, a bankruptcy attorney at Greenbaum Rowe Smith and Davis, expects that similar lawsuits will follow, with creditors being pulled in.

"My sense is this is really a play to bring pressure from the lenders to advance some money," Bruck said, noting that creditors usually have a bigger investment in these properties.

The worsening economy has already emboldened retailers to ask for more rent concessions, tenant improvement allowances and more say about which stores set up shop in a mall or shopping center.

Dillard's is part of a department store group that is being especially hard hit by the recession. The retailer swung to a fourth-quarter loss as sales and margins fell, and Standard & Poor's Corp. on Friday cut its debt rating for the company two notches deeper into junk territory, to B-minus.

Store operations have been troublesome, with Dillard's posting negative monthly same-store-sales since last July, and in the last three months the drops have exceeded analysts' expectations.

Suing "is not a bad way to break a lease so you can essentially get a store closed at a minimal cost," Marcotte said, noting there are shareholder considerations.

"To investors, saying I'm closing a store because of lease problems is different than saying it's closing for business reasons," he said.

-By A.D. Pruitt, Dow Jones Newswires, 201-938-2269, angela.pruitt@dowjones.com

-By Karen Talley; Dow Jones Newswires; 201-938-5106; karen.talley@dowjones.com