As virtual try-on tools become increasingly common in e-commerce, lawsuits are plaguing some of retail’s biggest names. The latest company to be targeted: Chanel, which has landed on the receiving end of a lawsuit filed by Zugara, Inc. In its newly filed complaint, the Los Angeles-based augmented reality (“AR”) company alleges that Chanel’s “Virtually Try-On” feature – which lets consumers preview lipstick and eyeshadow shades online via real-time AR – unlawfully makes use of its patent-protected technology.
According to the complaint filed in the U.S. District Court for the Western District of Texas on July 22, Zugara claims that Chanel’s digital makeup try-on tool, available on its U.S. website and mobile applications, infringes multiple claims in one of its utility patents (No. 10,482,517), including those that involve tracking body parts (like lips or eyes) and layering digital “try-on” products over live video in real time. Zugara maintains that Chanel’s AR-powered makeup modules perform all the steps of its patented method – namely, obtaining a live video feed, detecting the position or orientation of a user’s face, and superimposing virtual cosmetics that adjust dynamically as the user moves.
Chanel’s promotion of this tool is evidence of induced infringement, per Zugara, which points to Chanel-created tutorials and interactive prompts that encourage consumers to engage with the allegedly infringing AR interface. Its allegedly unauthorized use of the ’517 patent has caused irreparable harm by undermining licensing opportunities and diminishing Zugara’s competitive position in the rapidly expanding AR-commerce space, the company claims in support of its patent infringement case and its bid for injunctive relief and damages.
No stranger to litigation, Zugara has taken on similarly situated companies – such as Estée Lauder – alleging that its virtual makeup try-on tool tech and AR advertisements infringed the very same ’517 patent. These lawsuits suggest that Zugara is actively moving to protect its foothold as a pioneer in AR “try-on” technology. That case settled and was dismissed by a federal court in Texas on July 9.
The Bigger Picture: AR Tech as IP Battleground
In the past five years or so, AR has moved from experimental novelty to everyday utility, powering everything from digital try-on tools in beauty and eyewear, to immersive ad campaigns, interactive e-commerce, and even in-store navigation. As brands and platforms race to cement these technologies in their operations, they increasingly find themselves operating on patent-protected terrain – much of it laid years ago by early AR innovators or startups that have since shifted to enforcement mode.
Underlying this surge in enforcement is the growing strategic value of AR patents. As spatial computing and immersive commerce attract billions in investment, AR-related intellectual property has become both a shield and a sword. Against that background, tech companies and retailers, alike, are expanding their portfolios, acquiring AR startups (and their IP), and engaging in both defensive and offensive patent strategies to cement their position in this high-stakes space.
In short: As AR becomes an essential layer in how consumers shop, connect, and engage with brands, companies should expect its legal landscape to grow just as complex – and contentious.
The case is Zugara, Inc. v. Chanel, Inc., 7:25‑cv‑00324 (W.D. Tex.).
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