Shutterfly’s Spoonflower acquisition brings new headaches

GaryPageau ,
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When Shutterfly bought Durham, N.C., design and decor marketplace Spoonflower in 2021 for $225 million, the deal was seen as a way to “enable Shutterfly to more broadly serve the fast-growing home decor marketplace by adding Spoonflower wallpaper, fabric, linens, bedding and other home decor soft goods to its product assortment and connecting Shutterfly’s 21 million active users to Spoonflower’s artists and design community,” the company said in a press release. Since then, the combination hasn’t brought huge results, with Shutterfly shuttering Spoonflower’s Durham facility earlier this year, along with the departure of Spoonflower’s CEO Michael Jones, in November, 2023, following a stint as vice president and chief consumer officer at Shutterfly.

Now Shutterfly is facing a legal challenge, as Spoonflower finds itself at the center of patent infringement allegations. Plaintiffs Sharon Tedesco and Marc Tedesco, filed a federal suit against Spoonflower and Shutterfly, in late November, claiming patent infringement. The plaintiffs claim they hold patents relating to a “procedure map” — the encoding of fabrics in ways that allow them to be accurately measured, marked, and cuffed. The lawsuit claims Spoonflower, which prints on-demand fabrics, is doing something similar, in violation of those protections. The attorneys are asking for damages and a jury trial.

According to a report by the Triangle Journal, “the Tedescos learned of the alleged infringement when Sharon Tedesco purchased samples of fabric from Spoonflower last year, finding that the samples included a ‘procedure map’ like what they had patented, the lawsuit says. The Tedescos notified Spoonflower of the alleged infringement in May of 2022, but the company hasn’t stopped encoding its fabric.”