“Dupes,” or a product that is so similar it is like a duplicate of another, usually more expensive branded product, are becoming increasingly popular with the ease of online shopping and social media influencers pointing out the best dupe products on the market. However, there are significant legal risks and potentially costly consequences associated with dupes, among other types of intellectual property (IP) infringement. A recent case that underscores these risks is Lululemon’s lawsuit against Costco Wholesale Corporation (Costco), where Lululemon sued Costco over its dupes of Lululemon’s products. An experienced IP attorney can help guide brands and influencers through this emerging issue, ideally before litigation commences.
What Is a Dupe and How Are They Affecting Retail?
In today’s retail environment, dupes, lower priced products that closely resemble high end items, have created complex challenges for brands. Consumers increasingly seek affordable alternatives that replicate the style and appeal of premium brands, fueling a market where lookalikes, but not counterfeits, are becoming widespread and normalized. Dupes are prevalent across the retail market: fashion, beauty, home goods, electronics, the list goes on. For companies like Lululemon, which invest heavily in research, design, and brand reputation, dupes erode market share and dilute brand identity.
Why Did Lululemon Sue Costco?
Lululemon sued Costco for knocking off Lululemon’s products, and unlawfully trading on Lululemon’s reputation and goodwill. Lululemon brought claims of trade dress infringement, unfair competition, trademark infringement, and design patent infringement.
Lululemon claims that certain retailers, including Costco, have chosen to replicate its products instead of competing fairly. It asserts that it has invested significant resources into developing, promoting and protecting its brand, to refine its designs, construction and fit. As a result, Lululemon maintains that it has become one of the most recognizable names in athletic and lifestyle culture, and that Costco is unfairly profiting from these efforts and causing consumer confusion.
Trade Dress Infringement
At the core of Lululemon’s case is a foundational concept in IP law, trade dress infringement, which is distinct from, but often associated with trademark infringement. Trademarks protect brand names, logos, and other symbols that identify the source of a product, while trade dress extends protection to the overall look and feel of a product including its design, packaging or configuration so long as those elements are nonfunctional and have acquired distinctiveness in the marketplace.
Design Patent Infringement
In addition to its claims under trademark and trade dress law, Lululemon is asserting design patent infringement. Design patents protect the visual appearance of a product rather than its functional features, and proving infringement can be challenging due to the subjective and nuanced nature of the visual comparison required. Lululemon alleges that certain products sold by Costco, including the Danskin Half-Zip Pullover and Danskin Half-Zip Hoodie, infringe on Lululemon’s patents which protect the ornamental design elements of Lululemon’s Scuba apparel.
Specifically, Lululemon argues that an ordinary observer would likely find Costco’s products substantially similar to its own, as the resemblance is intentional and designed to mislead consumers into purchasing one product under the belief that it is another. In support of its argument, Lululemon presented a side-by-side comparison of its registered patents and the allegedly infringing Costco products.
Unfair Competition
Lululemon’s complaint also asserts multiple claims of unfair competition under federal law and California state laws. Generally speaking, unfair competition claims are aimed at deceptive business practices.
Under the federal Lanham Act, Lululemon alleges Costco has engaged in false designation of origin by marketing products in a manner that misleads consumers into believing the product is associated with or endorsed by Lululemon. Lululemon also brings parallel state law claims for unfair competition, which prohibit any unlawful, unfair, or fraudulent business practices to protect against the misappropriation of the fruits of another’s labor, goodwill and reputation.
In sum, these unfair competition claims provide Lululemon with a broader legal framework to argue that Costco’s actions, even if not found to constitute trademark, trade dress, or design patent infringement, still amount to unethical commercial conduct that harms both Lululemon and the public.
Conclusion
Understanding the nuances of dupes and IP infringement is essential to responding effectively when your design or products are being offered in the marketplace without your authorization. If you believe someone is unlawfully trading on your brand, reach out to a member of our team for next steps.
