Lululemon sues Costco over selling alleged dupes
Lululemon has filed a lawsuit against Costco, accusing the big box store of selling knockoffs of the athleisure brand's apparel for a fraction of the price.
According to the complaint filed Friday in the Central District of California, Costco allegedly "unlawfully traded" on Lululemon's "reputation, goodwill and sweat equity" by selling unauthorized and unlicensed knockoffs and dupes, infringing on the company's popular patents.
The complaint lists several Costco items that appear to rip off Lululemon's designs and patents: Costco's "Danskin Half-Zip Pullover" that retails for just $8. The lawsuit claims it's a dupe for Lululemon's SCUBA pullover that sells for $118. Costco's "Jockey Ladies Yoga Jacket" and "Spyder Women's Yoga Jacket," which sell for $22, appear to be a dupe of Lululemon's DEFINE jacket with a price tag of $128. The "Kirkland 5 Pocket Performance Pant," sold online for $10, is a dupe for Lululemon's $128 ABC Pant, the complaint contended.
The lawsuit alleged trade dress infringement, unfair competition under the Lanham Act, patent infringement, and violation of the California Unfair Business Practices Act.
Lululemon seeks to recover monetary damages from lost profits, claiming it suffered "significant harm" to its brands and reputation.
Dupes have surged in popularity, fueled by social media and young people seeking trendy, high-quality clothing without breaking the bank. The suit noted that hashtags like "LululemonDupes" have trended on social media platforms like TikTok, with influencers promoting "these copycat products."
Lululemon, based in Vancouver, acknowledged some companies have replicated its proprietary apparel designs and sold them as "dupes." The company said it has sent cease and desist letters to such companies, including Costco.
Specifically, the suit claimed Costco sells dupes of Lululemon's popular SCUBA, DEFINE, and ABC lines, "which have earned substantial fame and considerable goodwill among the public."
Costco allegedly profited off confusion and allowed customers to believe the products are authentic, the lawsuit claimed.
The suit said Costco is known to use manufacturers of popular branded products for its own Kirkland label products.
"This source ambiguity preconditions at least some consumers into believing that private label, Kirkland-branded dupes are in fact manufactured by the authentic suppliers of the 'original' products. Defendant does not dispel this ambiguity," the complaint said.
In November, Lululemon wrote to Costco about the infringement, and Costco subsequently removed at least some of the products that infringed Lululemon's SCUBA mark, but later began selling the Hi-Tec Men's Scuba full zip, the complaint said.
The suit seeks a jury trial and for the court to order Costco to pay Lululemon damages in the form of lost profits, an order to permanently restrain Costco from making or selling more dupes, and an order to remove any ads or posts displaying the infringing products.
Costco did not immediately respond to NBC News' request for comment on Tuesday.
Lululemon said in a statement that "as an innovation-led company that invests significantly in the research, development, and design of our products, we take the responsibility of protecting and enforcing our intellectual property rights very seriously and pursue the appropriate legal action when necessary."
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