Estee Lauder Sues Wal-Mart Over Alleged Sale of Counterfeit Beauty Items

Estee Lauder has filed a lawsuit in a California federal court, accusing Wal-Mart of selling counterfeit beauty products on its website and failing to take sufficient measures to ensure consumers receive only authorized and genuine goods.

According to legal documents submitted on Monday, Estee Lauder stated that it purchased, inspected, or tested multiple products bearing trademarks such as Le Labo, La Mer, Clinique, Aveda, Tom Ford, and "Estee Lauder" sold on Wal-Mart's website, all of which were identified as counterfeit.

The counterfeit items included imitations of Estee Lauder's Advanced Night Repair serum, Le Labo fragrances, Clinique eye creams, La Mer moisturizers, Aveda hair brushes, and Tom Ford perfumes.

Although these products were sold by third-party sellers on Wal-Mart's online platform, Estee Lauder argued that Wal-Mart played an active role in facilitating these sales. The historic beauty company described Wal-Mart's conduct as "extreme, outrageous, fraudulent... vile and harmful."

The complaint alleged that these counterfeit products were promoted and advertised on Wal-Mart's platform, with Estee Lauder's trademarks used in search engine optimization tools to drive traffic to the product pages, from which Wal-Mart profited.

Additionally, the lawsuit noted that "consumers shopping on Wal-Mart's website have reason to believe that Wal-Mart, not a third-party seller, is the seller of the goods," which could lead to consumer confusion.

Estee Lauder claimed in the filing that while Wal-Mart promotes the "reputation and professionalism" of sellers approved to operate on its platform, it has "done little to nothing to ensure that only authorized genuine products are sold."

The complaint stated, "This is evident given Defendant's claims of a rigorous selection process for its platform sellers/partners, yet counterfeit products continue to be sold on its site." "Thus, Defendant knew or had reason to know that the sellers it partners with and 'regularly reviews' are selling products that infringe Estee Lauder's trademark rights."