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Lululemon and Peloton in legal feud over 'copycat' products

Lululemon and Peloton in legal feud over 'copycat' products

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Exercise apparel brand lululemon has counter-sued against American exercise equipment company, Peloton. The lawsuit comes five days after Peloton brought its own case to the Manhattan federal court, claiming that lululemon's initial claims through a cease and desist letter on Peloton copying its designs had no merits. 

The dispute between these two companies started after Peloton launched its private-label apparel brand in September this year. The product launch came after the end of a five-year co-branding relationship between lululemon and Peloton which started 2016. According to Peloton's lawsuit, the termination of the Peloton-lululemon co-branding relationship was "amicable" and lululemon did not object in any way to Peloton’s termination decision, or Peloton’s offering of its own active wear apparel.

The partnership kicked off in 2016 when Peloton recognised a consumer appetite for products featuring its brand. As such, it began partnering with other active wear apparel companies, such as lululemon, to offer co-branded products. With the co-branding partnership with lululemon, Peloton sold a variety of lululemon apparel products co-branded by Peloton. Peloton said it would purchase lululemon products wholesale, after which Peloton would send the lululemon products to a separate printer to add Peloton’s branding. The co-branded products would then be sold by Peloton.

Peloton added that “the burdensome and time-intensive co-branding process” was not workable at the high demand levels Peloton started to experience, which led to the end of the partnership where Peloton then decided to launch its own private label brand of fitness apparel.

While the end of the partnership was "amicable", on 11 November, Peloton claims that lululemon slapped Peloton with a cease and desist letter, for the misappropriation of its designs, and asked the exercise equipment company to stop selling its “copycat products”.

Peloton argued that lululemon’s allegations lacked merit as "Peloton products revealed numerous clear and obvious differences" that allow the products to be easily distinguished. Along with differences in design, Peloton argued that lululemon’s brands and logos are also distinctive and well-recognised, making confusion between products a "virtual impossibility due to the prominent display of the parties’ respective trademarks" on their products. It added that both brands’ sophisticated consumers would be able to decipher the differences. 

Meanwhile, lululemon alleged that the designs from Peloton infringed on its design patent and trade dress rights. As such, lululemon demanded that Peloton confirm that it would cease its "wrongful acts", otherwise the company would file a lawsuit. It added that Peloton immediately wrote back and asked for more time (until 24 November 2021) to substantively respond to lululemon’s demands.

"As a good corporate citizen and out of consideration for the request from a former partner, lululemon acquiesced and agreed to extend the deadline for Peloton to respond," lululemon said, adding, "However, it is now clear that Peloton’s request for an extension was not made in good faith."

Moreover, lululemon said, “Unlike innovators such as lululemon, Peloton did not spend the time, effort, and expense to create an original product line. Instead, Peloton imitated several of lululemon’s innovative designs and sold knock-offs of lululemon’s products, claiming them as its own.” It added that the misappropriation of lululemon’s product designs was not a coincidence.

According to lululemon's initial cease and desist letter, as well as the counter lawsuit, Peloton's strappy bra, high neck bra, cadent peak bra, cadent laser dot bra, and cadent laser dot leggings infringed its patents. The company also said that Peloton started to sell the "One Lux Tight", which was another imitation of a lululemon product as it copies the "the trade dress of lululemon’s 'Align pant', which is one of lululemon’s all-time best-selling products". Lululemon also said in the complaint that Peloton "intended to closely copy Lululemon's proprietary designs" and pass off the goods as Lululemon's high-quality products to "misappropriate the immense goodwill that Lululemon has spent enormous time, effort, and expense to cultivate". 

Lululemon also said that by selling copies of lululemon’s designs, including the "Peloton Imitations", through the same retail outlets that Peloton has used to sell co-branded lululemon products, Peloton has created a "false or misleading" description and representation of fact which is likely to cause confusion or affiliation to its products.

"At Lululemon we are known for our product innovation and iconic design," lululemon said in a statement on Friday. "We will defend our proprietary rights, to protect the integrity of our brand, and to safeguard our intellectual property," said the company in a statement to Reuters.

MARKETING-INTERACTIVE has reached out to both lululemon and Pelaton for a statement. 

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