Wal-Mart Cutting Brands, Opening Itself Up to IP LawEt suit?

Try this article on for size. It's called "DUMPED: Brand Names Fight to Stay in Stores". The basic gist of it is that Wal-Mart is cutting back on the amount of brands that are sold in their stores. Not only that, but they are cutting back in favor of their store brands. The logic they are citing is that the economy is bad and it is more cost effective to stock fewer brands because what customers there are will be bargain hunting, not feature shopping. Thats reasonable and true...but not what they are doing. Hefty, a well known brand, was dropped from the store in favor of the wal-mart brand bags. They were welcomed back when they agreed to manufacture the Wal-Mart brand bags for a new lower cost. That was not an isolated case. It appears that many products have gotten themselves back into the store by doing something for Wal-Mart. Clearly this is not quite what it seems, unless you think it seems Wal-Mart is looking for a new and interesting way to twist suppliers arms and save money. Wal-Mart is huge and they feel no one will stand in their way because they haven't before. I propose that this might bite them in the ass.

I think there will be a huge IP backlash from this. Most of the brands that are being given the boot are commodity brands. Commodity brands have the hardest time differentiating themselves from other brands due to the common nature of the products they make. They will have patented and trademarked anything and everything they can that makes them stand out. Wal-Mart makes it's own versions of many of the successful commodity products that have differentiated themselves with minute details. The commodity brands are going to lose A LOT of money while Wal-Mart sells their products and they get no money because they are not even on the shelves.

The way these store brand generics usually work is that the company who makes the original product doesn't make a fuss when the big stores (CVS, Target, Wal-Mart) copy their products because they do not want the stores to take their brands off the shelves. This is a scare tactic, but it works, and brands don't complain. Now Wal-Mart is removing the brand names from the shelves and keeping the Wal-Mart brand products, leaving the brand names with no incentive not to sue for IP infringement. This isn't just one brand, but a lot of brands. I'm sure there's some form of Captain Planet type of team that could combine powers to be bigger than Wal-Mart in a courtroom. This could get interesting.