Trademark lawsuits are nothing new in fashion, but Lululemon’s latest claim against American retailer Costco strikes a very au courant nerve.
The activewear giant is suing Costco, the American retailer known for selling quality-controlled supermarket products in bulk, alleging that the popular members-only chain has copied some of its best-selling products such as the ABC pants for men, Define jacket and Scuba hoodie.
Lululemon has a track record of litigating against copycats. In late 2021, for instance, the Vancouver-based company filed a similar lawsuit against Peloton for patent infringement on sports bras and leggings, which Peloton settled the following year, agreeing to phase out some of its designs. A 2012 complaint against Calvin Klein and its manufacturer G-III also resulted in a settlement.
But unlike typical IP battles, Lululemon’s latest dispute is playing out in a very different arena — the court of public opinion, where consumers online have overwhelmingly sided with Costco.
“Definitely feels like they’re gonna do more damage to themselves by letting everyone know how close Costco can get for 1/4 the price,” one Reddit user wrote in response to the news.
“Lulu is delulu,” another wrote on Diet Prada’s Instagram post about the lawsuit.
What makes Lululemon’s accusations stand out isn’t claims of infringement; it’s the reaction to them. Whereas a decade ago, counterfeits carried a sense of taboo, shoppers today are openly embracing “dupes,” or affordable alternatives that closely resemble the original, more expensive products in both appearance and function. A true dupe, such as in the case of Costco for Lululemon’s performance-driven ABC men’s trousers, offer a high-enough quality at a fraction of the price.
Costco’s imitation was so successful that it triggered a slew of media content prior to the lawsuit, including a New York Times Wirecutter article titled “Are These $20 Costco Pants a Lululemon Dupe? We Investigated.” The verdict? They’re similar, but hardly the same in the details of design and functionality.
Citing this article and more, Lululemon has built a considerable case against Costco, according to Susan Scafidi, professor of fashion law at Fordham University and founder of the Fashion Law Institute.
“Lululemon has a long history of being at the forefront of the brand protection movement, and with this case, they’re again pushing the boundaries of what can be protected in US law,” Scafidi said.
Lululemon’s case draws on various legal safeguards, including design patents, registered trademarks and the notoriously difficult-to-attain trade dress protections that allow big brands to claim ownership over certain product design and packaging, rather than functionality components, which are covered by utility patents. But the retailer also seeks damages on certain unregistered product traits, such as the name of its “Tidewater Teal” signature colour, which it accused Costco of using to promote its version of similar products. The outcome of this case, Scafidi added, could create new precedents in fashion IP.
“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,” a Lululemon spokesperson told The Business of Fashion in a statement. Costco did not respond to a request for comment.
But before the matter is settled in court, Lululemon’s legal challenge may have created unintended consequences for the sportswear giant, drawing attention to Costco’s wares. There’s also a question of whether the lawsuit will end up hurting its reputation at a time when dupes are widely celebrated. In May, Steve Madden went viral for his interview on “The Cutting Room Floor” podcast, in which he cheekily admitted to drawing inspiration from labels such as Alaïa and The Row. The interview led to a spike in Steve Madden’s stock price.
And for Lululemon, the timing isn’t ideal: Last month, it slashed its earnings guidance for 2025 despite a 7 percent rise in overall sales, signalling pressure from tariffs and softening demand in the US. Its stock price is down 30 percent year to date.
“They’re struggling with getting people to pay that premium for their product,” said Janine Stichter, a retail analyst and managing director at financial services firm BTIG. “I wouldn’t be surprised if we see them use [litigation] a bit less in the future.”
Rather than pursuing legal action, which is expensive and does not guarantee success, brands could instead use creativity and humour to address a dupe situation, according to Scafidi. She points to a memorable moment in 2007 when jewellery designer Jessica Kagan Cushman mocked Chanel for allegedly copying her engraved resin bracelets by releasing a new version of the cuff with the phrase, “Ripped off by Chanel.”
It’s a tactic Lululemon is familiar with: In 2023, the brand hosted an event inviting shoppers to trade in their Lululemon Align legging dupes for the real deal.
“There may be a cult of Costco but there’s also a Lululemon tribe,” Scafidi said. “If you can tap into your base, you can send out an army of consumer foot soldiers.”
THE NEWS IN BRIEF
FASHION, BUSINESS AND THE ECONOMY
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Trump announced a Vietnam trade deal with 20 percent import tariffs. Following weeks of diplomacy, Trump declared a 40 percent levy would also be placed on goods determined to be transshipped through the country, while Vietnam has dropped all tariffs on US imports. Full details of what goods would be subject to the increased tariff were not available.
Prada credited its sandal’s Indian legacy amid uproar. Lorenzo Bertelli, the son of Prada’s owners, acknowledged the shoes were inspired by handmade Kolhapuri slippers after the luxury house was hit by criticism from media and lawmakers over cultural appropriation. Prada’s sandals are in early design stages and may not be commercialised.
Vivienne Westwood and Rei Kawakubo were paired for a blockbuster exhibition. The two avant-garde fashion designers’ works will be featured in a thematically curated exhibition at the National Gallery of Victoria that will open in Melbourne on Dec. 7. Over 140 works will be displayed, including garments donated by Kawakubo of Comme des Garçons.
The billionaire H&M founding family sped up its share purchases. The Persson family’s Ramsbury Invest holding company bought 42.75 million H&M shares in the first half of this year. By June, the family and its related companies owned over 64 percent of H&M’s shares, sparking speculation the company may return to private ownership.
France fined Shein €40 million for misleading discounts. Following a year-long investigation, France’s antitrust agency found the fast-fashion giant infringed French regulations by raising prices prior to applying discounts on items.
Watches of Switzerland warned US tariffs will weigh on its margin. The British luxury watch retailer said its margin on earnings before interest and taxes may plummet by as much as 100 basis points year on year, assuming US tariffs remain at the current interim 10 percent rate while the Trump Administration concludes trade deals.
Smythson of Bond Street was acquired by Oakley Capital. The 137-year-old British lifestyle brand known for its leather goods and homewares plans to use the investment to accelerate international expansion into the US, Japan and Europe through distribution, franchising and collaborations.
E-commerce firm Jumia drew takeover interest from Axian. The Mauritius-based telecommunication services company Axian raised $600 million this week to refinance debt and help fund a potential acquisition of Africa’s biggest e-commerce platform — a move that would help both companies’ continent-wide expansion efforts.
THE BUSINESS OF BEAUTY
L’Oréal agreed to acquire hair care brand Color Wow. The UK- and US-based company specialises in products for frizz control and curly hair. The French cosmetics conglomerate has been expanding its premium hair care offerings, after hair care was its second fastest growing category last year.
Kate Moss’ Cosmoss entered liquidation three years after its founding. In its liquidation filing, the skincare and wellness brand declared it owed $4 million to creditors, over $3 million of which is indebted to its founder’s talent agency, Kate Moss Agency.
Reliance Retail invested in Facegym. The Indian retailer made a minority investment in the UK-based facial chain for an undisclosed sum. Facegym will open studios in India and offer services within select Reliance-owned beauty retailer Tira stores, as part of Reliance’s broader push to expand Tira’s presence in the Indian market, against its rival Nykaa.
MEDIA AND TECHNOLOGY
Bold Management acquired influencer agency The Digital Prototype. With the move, the talent agency founded by Enrico de Finis in 2018 hopes to establish stronger positioning in France, where TDP manages 20 top talents. TDP founder Robin Martin-Chave and agency director Adeline Verdan will continue to manage the agency’s operations.
H&M released its first images with AI digital twins. The images debuted on the Swedish retailer’s Instagram account on Wednesday.
Compiled by Jessica Kwon.
