Lidl US says Kroger’s recent lawsuit of the name of its house brand is an attempt to sabotage the company’s launch in the U.S. market.
The Arlington, Va.-based arm of the German discounter responded to Kroger’s lawsuit in the Eastern District Court of Virginia, saying:
“Kroger is using this lawsuit to try to: disrupt the on-going launch of a new, emerging competitor that offers consumers high-quality products at lower prices; distract from the positive reviews garnered by Lidl’s launch by painting Lidl as a copycat – when in fact Lidl is a decidedly different and (better) grocery experience; and drive up Lidl’s cost by having to defend against Kroger’s spurious claims.”
Kroger’s suit claimed that Lidl’s private label brand, “Preferred Selection” is too close to its “Private Selection” brand and “creates confusion for customers and dilutes the value of its brand.”
Lidl used the court filing to point out the timing of the lawsuit, and Kroger’s disappointing sales performance. Kroger reported margins down by half, and lowered its earnings guidance the same day Lidl opened its doors in the U.S.
“Against that backdrop and in reaction to this increased competition, Kroger – two weeks later and without notice to Lidl – filed this suit and motion for a preliminary injunction on the Friday evening before the long July 4th weekend, and sought to have a hearing just days later to try to ram through extraordinary competitive relief to which it is not entitled.”
Kroger knew about Lidl’s proposed house brand name more than six months prior, the company said, in the statement.
“Although Kroger learned in November 2016 that Lidl intended to offer private-label products under the ‘Preferred Selection’ name and had more than six months to prepare its moving papers, Kroger has offered a striking absence of support in its claims.”