L.A.B. Golf and Lululemon’s Costco Membership May Be Expired: How Costco is Highlighting Challenges Faced by Brands – KJK

Costco Wholesale, known for its sales model which provides a wide array of products at significant discounts to its members, is facing allegations from Lululemon and L.A.B. Golf regarding unauthorized sales and product imitations.

Lululemon, a premium athletic apparel brand renowned for its high-quality and innovative designs, recently filed a federal lawsuit accusing Costco of selling knockoff versions or “dupes” of its signature clothing through Costco’s Kirkland Signature label and third-party suppliers. Meanwhile, L.A.B. Golf, an up-and-coming brand in the golf market, has raised concerns about the unauthorized sale of its popular DF3 putters on Costco’s website, highlighting potential challenges in controlling its sales channels.

These conflicts illustrate the growing challenges brands face in protecting their intellectual property, promoting consumer confidence using and maintaining brand integrity in today’s complex retail landscape.

Costco’s Alleged Dupes of Lululemon Products

Lululemon is a popular athletic apparel brand that uses its unique blend of high-quality materials and designs to create clothing that performs both in and out of the gym. Over the years, Lululemon has built a loyal following by focusing on innovative fabrics that offer comfort, durability, and moisture-wicking properties, combined with flattering, fashion-forward designs. Lululemon’s combination of technical performance and innovative branding has aided Lululemon in standing out from the crowd in the highly competitive activewear market. Lululemon has also invested significant resources in sponsorships of professional athletes, global ambassadors and organizations.

In June 2025, Lululemon filed a federal lawsuit against Costco, alleging that the wholesale retailer was selling unauthorized “dupes” of Lululemon’s popular apparel through its Kirkland Signature brand and third-party suppliers. The complaint claims that Costco’s products closely mimic Lululemon’s distinctive designs—such as the Scuba hoodie, Define jacket and ABC pants—resulting in consumer confusion and unfair competition.

Lululemon asserts that these alleged infringements violate its trade dress, design patents and trademarks. The company seeks injunctive relief to stop further sales, monetary damages and destruction of the infringing inventory.

Costco’s Alleged Unauthorized Resale of L.A.B. Putters

L.A.B. Golf has quickly emerged as a leading manufacturer of high-end, technologically advanced putters, thanks in part to professional golfer J.J. Spaun’s recent U.S. Open victory using one of its signature models, the DF3. The brand, known for its proprietary “Lie Angle Balance” technology, aims to simplify putting by eliminating torque and producing a repeatable swing.  L.A.B., a relatively new entrant in the ultra-competitive golf equipment market compared to other leading brands, has cultivated a brand image centered on innovation and premium exclusivity. To maintain control over pricing and customer experience, it relies heavily on a network of authorized dealers and direct-to-consumer sales.

That branding strategy was called into question recently when L.A.B. putters appeared for sale on Costco’s ecommerce marketplace, Costco.com. Notably, Costco priced L.A.B.’s popular DF3 putter at $369.99, about 20% below the price listed on L.A.B.’s own website ($449.00) and on authorized reseller sites such as Dick’s Sporting Goods and Golf Galaxy ($449.99).

The steep discount is not only inconsistent with L.A.B.’s controlled distribution model, but it could result in additional legal action against Costco. While L.A.B. has not publicly confirmed authorizing any direct sales to Costco, a letter reportedly sent by the company to its business partners refers to an “unauthorized sale” of DF3 putters on Costco’s website.

What Does This Mean?

Brands are in constant competition these days, not only with other brands but also with other ecommerce marketplaces, vying for both market share and consumer attention. Building a brand on strong intellectual property with features that are marketable and resonate with consumers is critical.

Lululemon has spent considerable time, effort and energy building its reputation and goodwill, from investment in sponsorships to investment in protectable trade dress, patents and trademarks. After significant investment, taking action to preserve brand value is equally important.

Meanwhile, L.A.B. is facing the challenge of channel control and price confusion. To curb these issues, L.A.B. will need to identify who is supplying Costco and determine how Costco can maintain adequate margins while pricing the products significantly below other retailers. Products sold outside of authorized channels not only raise quality control concerns, such as whether a seller’s storage, advertising and customer service are adequate, but also consumers may become confused on price and begin to question if the putters sold by Costco are different—either in material, manufacture or technology—than those L.A.B. putters sold by a preferred distributor like Golf Galaxy.

With that, brands should remain vigilant in monitoring marketplaces, enforcing reseller agreements and taking necessary legal action to continue building upon the foundations and features that set them apart from their competitors.

Next Steps

Brands face increasing challenges in today’s retail landscape. For guidance on brand protection or enforcement strategies, reach out to KJK eCommerce attorneys TJ Hunt (TJH@kjk.com), Kyle Stroup (KDS@kjk.com) or Alex Jones (AEJ@kjk.com).