P&G is suing Poundstetcher following claims the budget retailer has been selling counterfeit Head & Shoulders shampoo and Ariel laundry products.
The multinational is also taking legal action against wholesalers Home and Beauty and J&S, alleging the three firms infringed its trademarks between 2014 and 2013.
The fake products were reportedly brought to P&G’s attention back in 2013 when a customer who shopped in the discount chain’s store in Sutton-in-Ashfield complained to Trading Standards about Ariel powder and lab tests revealed the goods to be false.
According to the Times, P&Gs agents apparently purchased a variety of Head & Shoulders products from Poundstretcher stores; all of which were found to be counterfeit. Last year the consumer giant traced the goods back to Home and Beauty, J&S along with two other suppliers which won’t be facing action.
While Crest-owned Poundstretchers or Home and Beauty have yet to submit defences to the claim, which will see P&G seek to recover damages and demand to be told the origins of the false products, J&S has said it "does not admit" to having stocked or sold the products.
The case could shine a spotlight on the way the discount sector is supplied, as low price stores like Poundland - which hasn’t been associated with counterfeit products - are set to gain ground on rival traders following a healthy 2015.