Britain to Investigate ASOS, Boohoo and Asda's Environmental Claims

A keyboard and a shopping cart are seen in front of a displayed ASOS logo in this illustration picture taken October 13, 2020. REUTERS/Dado Ruvic/Illustration
A keyboard and a shopping cart are seen in front of a displayed ASOS logo in this illustration picture taken October 13, 2020. REUTERS/Dado Ruvic/Illustration
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Britain to Investigate ASOS, Boohoo and Asda's Environmental Claims

A keyboard and a shopping cart are seen in front of a displayed ASOS logo in this illustration picture taken October 13, 2020. REUTERS/Dado Ruvic/Illustration
A keyboard and a shopping cart are seen in front of a displayed ASOS logo in this illustration picture taken October 13, 2020. REUTERS/Dado Ruvic/Illustration

Britain's competition regulator will investigate whether fashion brands ASOS, Boohoo and George at Asda are misleading shoppers with their environmental claims as it scrutinizes retailers for evidence of "greenwashing".

The investigation comes as regulators heighten scrutiny of companies which may be exaggerating their green credentials in an attempt to woo climate-conscious consumers as well as billions of dollars from environmentally-focused investor funds, Reuters said.

"People who want to 'buy green' should be able to do so confident that they aren't being misled," Competition and Markets Authority (CMA) interim Chief Executive Sarah Cardell said in a statement.

"Eco-friendly and sustainable products can play a role in tackling climate change, but only if they are genuine."

If the three companies are found to be misleading customers, the CMA will take enforcement action, including in court, if necessary, Cardell said, noting the probe was "just the start" of the CMA's work in the clothing sector.

The agency has outlined its concerns to the three companies and will begin gathering evidence, which will help it to decide whether there have been breaches of consumer protection laws.

It will examine whether the language used in marketing clothing, footwear or accessories is too vague and whether the criteria used by the companies to label products as sustainable might be lower than customers might reasonably expect.

Online fashion retailers ASOS and Boohoo said in separate statements they would work with the CMA and were committed to providing accurate information about their products.

Representatives for supermarket group Asda, which owns the clothing line George, did not immediately respond to requests for comment.

INVESTIGATING GREEN CLAIMS
The CMA's concerns come as the global fashion industry comes under increasing pressure to clean up its act.

The United Nations says the industry is the second biggest consumer of water globally, behind agriculture, and according to estimates, is responsible for up to 8% of carbon emissions.

Many regulators across the United States and Europe are cracking down on potentially false environmental, social and governance-related (ESG) claims made by companies across sectors as well as investor funds to make sure they are backed up.

The CMA last year published a green claims code, a set of guidelines for companies and shoppers to ensure that environmental claims are genuine and not misleading.

It will examine products in the fashion brands' eco ranges, where some labeled as environmentally friendly can contain as little as 20% recycled fabric, the CMA said.



Lululemon's Lawsuit Against Costco Highlights Rise of Fashion 'Dupes'

FILE - Lululemon signs are displayed outside a retail location in the Seaport District, Dec. 13, 2024, in Boston. (AP Photo/Charles Krupa, File)
FILE - Lululemon signs are displayed outside a retail location in the Seaport District, Dec. 13, 2024, in Boston. (AP Photo/Charles Krupa, File)
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Lululemon's Lawsuit Against Costco Highlights Rise of Fashion 'Dupes'

FILE - Lululemon signs are displayed outside a retail location in the Seaport District, Dec. 13, 2024, in Boston. (AP Photo/Charles Krupa, File)
FILE - Lululemon signs are displayed outside a retail location in the Seaport District, Dec. 13, 2024, in Boston. (AP Photo/Charles Krupa, File)

Fashion “dupes,” or less expensive versions of high-end clothing and other accessories, are just about everywhere these days. They're also drawing some businesses into legal battles.

In the latest example, Lululemon slapped a lawsuit against Costco on Friday, accusing the wholesale club operator of selling lower-priced duplicates of some of its popular athleisure apparel.

Across the retail industry, it’s far from a new phenomenon. But social media is pushing the culture of online dupe shopping to new heights as influencers direct their followers to where they can buy the knockoffs. Want a taste of Hermès' $1,000 fuzzy slippers?

Target has a version for $15. Looking for a $2,800 price Bottega Veneta hobo bag? There’s a version for $99 on online clothing and accessories upstart Quince, which has become a go-to for fashionistas.

It's not even the first time Lululemon has encountered what it says are knockoffs of its clothing, which often carry steep price tags of over $100 each for leggings and sporty zip-ups. Without specifying additional sellers beyond Costco in Friday’s complaint, Lululemon noted that a handful companies have “replicated or copied” its apparel to sell cheaper offerings — including those popularized online through hashtags like “LululemonDupes” on TikTok and other social media platforms.

Dupes aren't new For years, companies have rolled out a range of cheaper option for consumers to buy instead of pricey name-brands or designer labels — often through retailers' house or generic brands. Unlike more direct copies of the product with an unauthorized trademark or logo of a patented brand, “pure” dupes that just resemble certain features are generally legitimate. They can even spark awareness of the original items.

But the rising frenzy for dupes, particularly in the fashion space, signals that many shoppers want a taste of luxury, but no longer want to pay for (or care about) getting the real thing.

Late last year, for example, discount chain Walmart created a buzz when it started selling a leather bag online that resembled Hermès’ coveted Birkin bag. The $78 item — sold by Kamugo, which doesn’t appear to have its own website — was a fraction of the price of the original, which goes from $9,000 to hundreds of thousands of dollars on resale and auction sites. Influencers labeled the leather bag a “wirkin.” Other suppliers including BESTSPR, YMTQ and Judy were listed on Walmart’s site selling similar totes.

While popular among shoppers, these kind of look-alikes can frustrate the targeted companies. Following the viral fame of the “wirkin,” Hermès Executive Chairman Axel Dumas shared his annoyance, for example.

“Making a copy like this is quite detestable,” Dumas said in a corporate earnings call in February. Still, he acknowledged that it was “quite touching” to see so many consumers want a bag with the Birkin style — and that “difference in quality” was still evident, noting that nobody bought the dupe thinking it was from Hermès.

When dupes venture into uncertain legal territory Alexandra Roberts, a professor of law and media at Northeastern University, said that “the term ‘dupe’ itself doesn’t tell us much about legality," noting the word has also been used to describe more traditional counterfeits.

But overall, dupes can move into shaky legal territory, including copyright and trademark infringement, particularly if a dupe marketer makes false claims about the duplicate or the original.

“With fashion, in particular, we’re going to get into some thorny questions," Roberts said. That includes what intellectual property rights exist and how enforceable they are, she explained, and whether there is actual infringement or if a product is just “positioning itself as a less expensive alternative.”

Often such disputes boil down trademark questions around consumer confusion or patented product designs. Several businesses have already put this to the test, but not always successfully.

In December, for example, Benefit lost a lawsuit in California over E.l.f.'s $6 Lash ’N Roll mascara, which is similar to Benefit’s $29 Roller Lash mascara. The judge’s decision was “a resounding win for us,” E.lf. CEO Tarang Amin previously told The Associated Press.

“The basic reality is we always put our E.l.f. twist on it,” he said. “It’s an E.l.f. product that’s a much better value.”

Lululemon sues Costco In its lawsuit, Lululemon argued that Costco had “unlawfully traded” on Lululemon’s reputation and that it was suing as part of wider intellectual property enforcement “directed to retailers who have chosen to copy rather than compete.”

Lululemon accuses Costco of making duplicates of several products, including its popular Scuba hoodies, Define jackets and ABC pants. Lululemon says one of the duplicates that Costco sells is the Hi-Tec Men’s Scuba Full Zip, with the lawsuit showing a screenshot image of Costco’s website showing the item priced at $19.97.

Roberts said she was “a little skeptical” of some of Lululemon's claims, noting that the design patents in particular could be hard to challenge. And she pointed to Lululemon's asserting common law trade dress over a “triangle kind of shape in the crotch region” of the ABC pants.

“My first reaction as a trademark expert is that looks pretty functional,” she said, and functional matter is not protected under trademark law. “I was just cracking up because that particular claim seemed really far-fetched to me. Those pants look really basic."
Still, Roberts noted that Lululemon had some plausible claims.

Lululemon alleges that Costco is known to use manufacturers of popular branded products for its private label Kirkland brand, although the companies involved don't clearly reveal that information to customers. Due to this, Lululemon claims some shoppers may believe that Kirkland-branded products are made by the authentic supplier of the “original” products.

Roberts said this could rule in Lululemon's favor as something that “weighs toward consumer confusion.” Still, she noted that most of the products Lululemon mentioned in its complaint weren't sold under the Kirkland brand, which could undermine the argument.

A message was left Tuesday seeking comment from Costco on the lawsuit.

Lululemon found itself in a similar dispute with Peloton in 2021, when it sued the exercise bike company over alleged “copycat products” in its then-new clothing lines. Two years later, the companies announced a five-year partnership that included Lululemon becoming the primary athletic apparel partner to Peloton.