This depends on contracts you signed + if you're in a legal pool.

If you're in a legal pool, makes no difference (to me) how often I'm sued, because I can always go longer in court than the other side, so I always win.

https://clarity.fm/questions/4768/answers/15740 covers how this works.

You pay a monthly flat rate for unlimited out of court time + 100s of hours in court time.

I can't imagine living in the US without Legal Shield coverage.

Nothing sucks time + money like lawsuits, unless you don't have to pay any money or invest any time, because you're in a legal pool.

Once you have Legal Shield coverage for at least 10 days (which is what use to be required for coverage to begin) then do whatever you like.

If you get sued, you'll just laugh, because you might be able to suck the other side so dry, you can pick their clients for your product.

What to do practically should already be outlined in your service/placement agreement with this vendor.

I like the idea of selling on your own for two reasons: 1) more control and insight into your inventory and sales traction figures and 2) when the time comes again to work with 3rd parties to sell your product you'll have better insight on what does work (what you've done) and what doesnt work (what your current partner is doing) to give better guidance to make both of you a success.

the answer to this too can be a little dependent on industry - my experience in helping our clients mostly deals with the fashion and food spaces. so FYI/full disclosure there. In those cases though they encountered the exact problem you are, so we pulled their product arrangements, created a digital and self-owned space where they could sell their product and build a community of buyers, then they went back out after getting some traction and were better able to negotiate with bigger players (Nordstrom, Macy's, Whole Foods, etc) to take full advantage of affiliate buying and marketing.

Happy to connect and talk through your own specific situation; best of luck in either regard.

First question: What are the ramifications of this company not selling your product; monetary or perspection? If you are ok dealing with the impacts then...

Second question: Are you under contract with this company? If so, is there an exclusivity or termination clause? If no exclusivity, sell away. If there is a termination clause, is it performance-based or just providing notice? Execute it. If you aren't under contract, let them know that you've decided to take the product in-house and that you will no longer be selling them the product.

Keep in mind that you will always be more passionate about your product then anyone else. You are going to be forever disappointed if that is the standard you hold other companies to.