from the i-thought-yoga-was-calming dept
karm sends word that yoga pants maker Lululemon has decided that it can't compete with cheaper alternatives and so will sue the competition.
"This is a low barrier-to-entry industry. Lululemon, their success, has drawn new competitors throughout the mall," said independent retail analyst Brian Sozzi. "The valuation is so high. It's tough to warm up to a stock when you see so many new competitors."If that is not crazy enough, this same company has been able to compete with other big players without going to trial.
In the suit filed in federal court in Delaware on August 13, Lululemon accused PVH Corp's Calvin Klein brand and manufacturer G-III Apparel Group Ltd of infringing three patents on the design of its yoga pants. Design patents protect the appearance of goods, in contrast to more common utility patents, which focus on how things work.
The company says it competes with athletic apparel heavyweights such as Nike Inc and Under Armour Inc by offering better quality, and it maintains its enviable margins by taking charge of every stage of the process - from design, to production, to sale.If Lululemon can compete with those two companies by offering better quality to its customers, why is it not able to do so with Calvin Klein? Well, it makes the claim that some of these new products match their own quality but are far cheaper. Gee. I wonder if maybe there was something other than litigate that Lululemon could be doing that could work to its advantage. Like maybe competing on price. If quality is no longer a defining feature, then price is another good place to compete.
It really is sad when we see a company which feels threatened by the competition resorting to lawsuits rather than competing in the market. We have already seen how ridiculous such lawsuits can get with Apple and Samsung. But I guess that since that came out in favor of design patents, at least for now, we can probably expect to see many more of these kinds of lawsuits in the future.