Costco's $128 Yoga Pants Face-Off Lululemon's Lawsuit!

Lululemon Takes Legal Action Against Costco Over Alleged Knockoff Athleisure Wear

The athleisure giant Lululemon is locked in a legal battle with retail giant Costco, accusing the wholesaler of selling unauthorized versions of its popular and often pricey athletic apparel. The lawsuit, filed on Friday, alleges that Costco is profiting from knockoffs of Lululemon's signature designs, potentially confusing consumers and damaging the brand's reputation.

At the heart of the dispute lies Lululemon's claim that Costco's private-label brand, Kirkland, is offering items like pants, hoodies, and jackets that closely resemble Lululemon's designs, but at significantly lower prices. Lululemon argues that this practice leads customers to believe these Kirkland-branded items are manufactured by the same supplier as the "original" Lululemon products.

The 49-page lawsuit, filed in California, meticulously details the alleged design similarities between Lululemon's products and Costco's offerings, alongside a stark comparison of their price points. To illustrate this, the lawsuit points out that Lululemon sells its popular Scuba hoodie for $118, while a similar version at Costco retails for approximately $8.

Here's a quick breakdown of the key points:

• Lululemon alleges Costco is selling "unauthorized and unlicensed apparel" that infringes on its designs.
• The lawsuit highlights significant price differences between Lululemon products and the alleged Costco knockoffs.
• Lululemon claims Costco is misleading customers into thinking Kirkland-branded items are affiliated with Lululemon.

While Costco has declined to comment on the ongoing litigation, Lululemon issued a statement to CNN, asserting its commitment to protecting its intellectual property rights. The company emphasized its significant investment in research, development, and design, stating that it will "pursue the appropriate legal action when necessary."

Lululemon further elaborated on the potential harm caused by these alleged "dupes," stating that "one of the purposes of selling ‘dupes’ is to confuse consumers … into believing that the ‘dupes’ are (Lululemon’s) authentic products when they are not."

Lululemon is seeking to recover full financial losses through unspecified monetary damages and is requesting a court order to halt Costco from continuing to sell these disputed products. This isn't the first time Lululemon has taken legal action to protect its brand. In 2021, the company sued Peloton over similar apparel design concerns. Interestingly, the two companies later resolved their differences and even partnered to sell branded clothing.

This lawsuit comes at a challenging time for Lululemon, which recently lowered its full-year guidance, citing a "dynamic macroenvironment," including declining store visits, the impact of tariffs, and increasing competition from rival brands like Vuori and Alo. Adding to the pressure, Lululemon's stock (LULU) is down 37% for the year.

The outcome of this legal battle could have significant implications for both Lululemon and Costco, as well as the broader athleisure market. It highlights the ongoing tension between protecting intellectual property and offering consumers affordable alternatives. Only time will tell how this case unfolds, but it certainly underscores the value Lululemon places on its brand identity and its commitment to defending its designs.

Tags: Lululemon, Costco, Athleisure, Knockoffs, Lawsuit, Kirkland, Apparel, Scuba hoodie, Design, Counterfeit

Source: https://edition.cnn.com/2025/06/30/business/lululemon-costco-lawsuit