Patagonia has filed a lawsuit against Kimberly McHugh, one of Amazon's giant third-party sellers. McHugh's Our Little Corner store is considered a “gray market” supplier as neither she nor Amazon is an authorized Patagonia dealer.
According to The Fashion Law, Patagonia is arguing that Amazon is not a competitive market because of the “absence of authorized dealers.” This commercial gray area allows resellers like McHugh to “gouge consumers” with inflated prices that they "will believe originate from Patagonia.”
The suit specifically cites Our Little Corner's $272 price tag on the Men’s Nano Puff Jacket, which Patagonia sells for $199. Patagonia claims that by using its famous Fitz Roy logo trademark, McHugh is not only misleading and exploiting customers, she's also comprising Patagonia's dealer agreements as well.
Patagonia has built a reputation for its strong cultural credibility. So while it's technically legal for McHugh to resell authentic items, she does so by bypassing Patagonia’s rigorous policies; systems that have made it a trusted brand.
McHugh isn't the only one trying to profit off Patagonia's brand identity. The outdoor clothing brand is also taking legal action against Anheuser-Busch (Budweiser, Michelob, Stella Artois) for introducing a “Patagonia” brand beer. According to CNN, the clothing label claims that Anheuser-Busch is doing “everything possible to make it appear as though this PATAGONIA beer is sold by Patagonia.”