Dupe culture on trial: Lululemon, Costco, and the future of trademark law

In a digital age driven by influencer culture, viral hashtags and aesthetic mimicry, the fashion industry has encountered a new battleground: the legal implications of "dupes." These copycat products, marketed to replicate premium brands at a fraction of the price, are not new -- but their proliferation through TikTok trends and YouTube hauls has raised the stakes for brand owners and retailers alike. The recent lawsuit filed by Lululemon against Costco provides a timely lens through which to examine how the Lanham Act, design patent law, and trade dress protection are evolving to meet the realities of social media-driven consumer confusion.

The rise of the dupe economy

The term "dupe" (short for duplicate) has become shorthand for aspirational consumption. Influencers regularly tout budget-friendly alternatives to luxury goods -- often using side-by-side comparisons, packaging call-outs, and trending hashtags like #LululemonDupe or #ScubaDupe. These tags signal a kind of wink to savvy consumers: "This isn't the real thing -- but it looks close enough."

For brands like Lululemon, whose identity and pricing are built on design innovation and exclusivity, the stakes are more than aesthetic. On June 27, 2025, Lululemon filed a federal lawsuit against Costco Wholesale Corporation in the Central District of California, alleging trademark infringement, design patent infringement, and unfair competition. The complaint targets Costco's sale of apparel items -- including a "Scuba" zip-up and products in the color "Tidewater Teal"-- which Lululemon argues are intentionally designed to mislead consumers into believing they are buying authentic Lululemon merchandise.

Trade dress and the question of functionality

One of Lululemon's key claims is trade dress infringement -- namely, that its Scuba hoodies, Define jackets, and ABC pants possess a distinctive look that has acquired secondary meaning in the minds of consumers. In assessing trade dress protection under Two Pesos, Inc. v. Taco Cabana, Inc. (1992), the court must determine whether the claimed dress is (1) nonfunctional, (2) distinctive, and (3) likely to cause confusion.

Costco will likely argue that the features in question -- such as zipper placement, hood shape, and seaming -- are functional, serving a utilitarian purpose rather than signifying brand origin. This argument aligns with the Supreme Court's decision in TrafFix Devices, Inc. v. Marketing Displays, Inc. (2001), which held that functional product features cannot receive trade dress protection. Lululemon, in response, will need to distinguish its design elements as ornamental rather than essential to function -- a burden that becomes even more complex when the design has already been the subject of a utility or design patent.

Design patents: A higher bar

The lawsuit also asserts infringement of several design patents, including U.S. Patent Nos. D989,442 and D1,035,219, which cover specific ornamental aspects of Lululemon's apparel. Under the Egyptian Goddess, Inc. v. Swisa, Inc. (2008) standard, design patent infringement occurs when an ordinary observer would find the accused design substantially the same as the patented design in light of the prior art.

This test, although more favorable to patentees than earlier formulations, remains difficult to satisfy. Differences in stitching, fabric material or logo placement may be enough to distinguish the designs. Unless Lululemon can show that Costco's products are nearly indistinguishable to a reasonable consumer, the design patent claims may be the least predictable aspect of the case.

Trademark claims: 'Scuba' and 'Tidewater Teal'

Perhaps the most interesting facet of the case is Lululemon's assertion of rights in the word mark SCUBA(r) and the color name "Tidewater Teal." Trademark law permits the registration of color names and product descriptors, but only where they have acquired distinctiveness and function as source identifiers. In Qualitex Co. v. Jacobson Products Co. (1995), the Supreme Court held that color alone can be protected under trademark law -- but only if it has a secondary meaning.

While both "Tidewater Teal" and "Scuba" are the subject of existing live trademark registrations held by Lululemon, "Scuba" may face a stronger challenge due to its widespread use in the apparel industry as a descriptive term. The word "Scuba" is frequently used in the apparel industry to describe fabric weight (i.e., "scuba knit") or wetsuit-inspired silhouettes. A search of the United States Patent and Trademark Office (USPTO) database reveals at least 18 live registered trademark registrations containing the term "Scuba" within the international class for clothing. Likewise, a search of Bing uncovers approximately 375,000 results for "scuba knit apparel fabric" and 237,000 results for "scuba knit fabric weight," demonstrating "scuba's" widespread usage as a descriptor for medium-weight, neoprene-like double-knit textiles. Costco may invoke the fair use doctrine, arguing that "Scuba" is used descriptively and not as a trademark -- a defense supported by KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc. (2004).

Social media and the erosion of confusion

One of the most fascinating legal wrinkles is how the modern "dupe" culture itself may undercut traditional notions of consumer confusion. In many cases, consumers knowingly purchase lower-priced alternatives without believing they are buying the real thing. In fact, the allure of dupes often lies in the fact that they aren't the authentic product -- but resemble it closely enough to give the impression.

This nuance complicates the likelihood of confusion analysis, which is central to trademark and trade dress infringement claims. While courts have traditionally relied on consumer survey evidence, today's legal disputes are shaped by social media trends, influencer endorsements, and user-generated content. A TikTok video labeling a product a "Lululemon dupe" might simultaneously reinforce brand distinctiveness and undermine claims of actual confusion.

Companies thriving in the dupe economy

Several companies have built thriving business models around dupe culture. FashionNova, for example, has earned a reputation for launching near-identical versions of celebrity fashion moments within days. Chinese fast-fashion giant Shein is known for algorithmically producing apparel that mirrors designer pieces, a practice that has earned it both massive profits and a wave of IP infringement lawsuits. Brands like PrettyLittleThing, Missguided and even Amazon's private-label fashion lines embrace the dupe label, leveraging influencer campaigns and viral marketing to generate buzz, often without directly referencing the source brand.

These companies have largely avoided major liability by walking a fine legal line -- avoiding trademarks, altering enough details to avoid "substantial similarity," and relying on the ambiguous legal space between inspiration and imitation.

Strategic enforcement: A page from the Peloton playbook

It is worth noting that this is not the first time Lululemon has taken legal action to defend its IP. In 2021, Lululemon sued Peloton for trade dress infringement related to its private-label activewear line. Although the case was highly publicized, it never went to trial. Instead, the parties reached a confidential settlement and ultimately formed a business partnership.

This prior litigation suggests that Lululemon's current suit against Costco may be as much about negotiation leverage as it is about courtroom success. By asserting its rights forcefully and publicly, Lululemon reinforces the strength of its brand while creating an opening for potential resolution on business terms. Whether this playbook results in a licensing arrangement, a supply partnership, or a cease-and-desist agreement remains to be seen. But the Peloton case demonstrates that enforcement can also be a prelude to collaboration -- a dynamic increasingly common in modern brand protection strategy.

Implications for enforcement strategy

For brand owners, Lululemon's lawsuit signals a more aggressive posture toward copycat marketing. It also highlights the value of registering distinctive marks -- such as color names -- and building a record of consumer recognition. However, companies must be cautious. Overreaching in enforcement can backfire if courts determine the claimed IP lacks distinctiveness or is functional in nature.

For retailers and manufacturers, the case underscores the importance of legal clearance and careful branding. Even if a product is technically non-infringing, suggestive marketing -- especially in packaging, naming, or colorways -- can still expose companies to risk under unfair competition statutes.

Conclusion

As social media continues to blur the line between inspiration and imitation, courts and attorneys must recalibrate their tools for assessing consumer confusion. Lululemon's case against Costco may not just decide whether "Scuba" is a protectable mark or whether a teal jacket is too similar -- it may redefine how trademark law addresses the era of intentional resemblance and viral duplication.

One thing is clear: in today's marketplace, the legal boundaries of branding are as flexible --and contested -- as the apparel they aim to protect.

And at the heart of this case lies a simple, unresolved question: does a consumer truly believe they are buying a Lululemon product when they pick up a Kirkland-branded jacket at Costco? Probably not. The value of the Kirkland brand lies in its affordability and private-label reputation -- attributes that suggest most consumers understand exactly what they're purchasing: a dupe. Whether that acknowledgment eliminates legal liability is another matter entirely.

Beyond the legal claims themselves, the lawsuit Lululemon Athletica Canada Inc. v. Costco Wholesale Corp. (2025) may serve a broader purpose: signaling to the market that Lululemon is prepared to defend its brand identity -- publicly and aggressively. By taking on a major national retailer like Costco in a high-profile infringement suit, Lululemon reinforces its position as a premium brand with protectable IP. Even if the case does not proceed to trial or results in a confidential settlement, the public nature of the filing alone sends a clear message: Lululemon views unauthorized duplication not just as a legal issue, but as a direct threat to its brand equity. This type of "loud" enforcement strategy -- particularly in the context of dupe culture -- may be designed as much for deterrence and consumer perception as it is for courtroom victory.