Dive Brief:
- Replenium, an e-commerce company that offers auto-replenishment technology to retailers, filed a lawsuit Monday in federal court against Albertsons, alleging the grocer misappropriated trade secrets and breached the companies’ contract.
- The software company claims the grocer used its partnership with Replenium to build its own system to replace Replenium’s.
- “Albertsons’ calculated maneuver cost Replenium millions of dollars in contract revenue and tens of millions of dollars in development of the platform and inflicted a substantial loss to Replenium’s investors,” Replenium said in the suit.
Dive Insight:
Albertsons partnered with Replenium in October 2020 to launch the Replenium Platform, agreeing to pay the company service fees based upon the net revenue generated through the replenishment orders placed by the grocer’s customers, according to the complaint.
At the end of 2021, Albertsons unveiled “Schedule & Save,” an online auto-replenishment offering for loyalty program members that it developed in partnership with Replenium, noting the tool was available to select Safeway customers in northern California. Albertsons said in the announcement that it planned to roll out the tool nationwide in 2022 as well as add a new feature to allow people to continuously add items for automatic replenishment.
Replemnium says that Albertsons delayed — yet continued to promise — the nationwide rollout as it kept asking the software company to share trade secrets and confidential information.
“As an added inducement, [Albertsons Senior Vice President of Digital Shopping Experiences Jill] Pavlovich specifically pointed Replenium to Albertsons’ recently announced planned merger with Kroger, stating that Replenium stood to generate fees beyond Albertsons’ replenishment volume because” of the merger, according to the complaint, filed in the U.S. District Court for the Western District of Washington.
In October 2023, Albertsons abruptly ended the contract with Replenium, citing the proposed Kroger merger as one of the reasons, and then quickly launched its own, “nearly identical” full-basket auto-replenishment solution, according to court documents.
“Unbeknownst to Replenium, during Replenium’s three years of confidential information sharing, Albertsons was misappropriating Replenium’s trade secret and confidential information by building its own competing, full grocery basket auto-replenishment solution to replace the Replenium Platform,” the complaint says.
Albertsons declined to comment.
Tom Furphy, a former Amazon Fresh and Wegmans executive, founded Replenium in 2015.
Replenium is seeking a jury trial and wants Albertsons to pay it an unspecified monetary amount.