The company behind Kim Kardashian and Kylie Jenner's beauty brands says a competitor stole trade secrets when it invested in the family's businesses (COTY)

Coty, the struggling conglomerate behind brands like Covergirl and Sally Hansen, invested earlier this year in Kylie Cosmetics and just inked another deal with Kardashian West.
Seed says the King Kylie deal was merely "a subterfuge" to learn its "confidential business methodologies."
Representatives for Coty and Kylie Jenner did not respond to requests for comment.
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Seed Beauty, the company behind Kim Kardashian West and Kylie Jenner's highly successful cosmetics lines, has accused its competitor, Coty, of stealing trade secrets when it invested in King Kylie earlier this year.

Now, as the struggling Coty buys a stake in Kardashian-West's own line that's set to make her a billionaire , Seed wants the court to step in and protect its "secret sauce."

"Out of deep respect for Kylie Jenner, Kim Kardashian, and the highly successful businesses Seed created with them, Seed attempted to resolve this dispute privately and repeatedly asked for assurances related to leakage of Seed proprietary information from King Kylie to Coty," Seed said in the partially redacted complaint filed Tuesday in Los Angeles superior court.

"Coty and King Kylie consistently refused to provide any assurances," Seed said, claiming that the investment "really was a subterfuge to learn Seed's confidential business methodologies."

Seed is asking the court for another injunction like the one it received earlier in June, which prevents Kardashian West from sharing trade secrets in her deal with Coty.

"This action is to stop Coty's theft of Seed's pioneering and proprietary digital-first business model that has revolutionized the cosmetics industry," Seed said.

Coty, which did not respond to a request for comment from Business Insider, has not yet formally responded to the suit. Representatives for Jenner did not immediately respond to a request for comment. The first court hearing is scheduled for October.

Jenner's makeup line has been a business boon for Coty, which also counts brands like Sally Hansen and Covergirl among its portfolio. Its deal with Kardashian West can help it continue to evolve as legacy brands struggle and its stock price stutters, experts say.

"The partnership is consistent with COTY's goals of using social media-driven brands to expand consumer reach given Kim Kardashian West's appeal with the Gen X and older millennials and the exposure Kim's half-sister Kylie Jenner has with the Gen Z and younger millennials," Andrea Teixeira, an analyst at JPMorgan, told clients this week.

"However, we do not believe the transaction solves the lack of engagement in the company's legacy brands Covergirl, MaxFactor, Rimmel, or Sally Hansen, because there is no Kylie Beauty or KKW Beauty endorsement included, at least at this point."

However, Jenner's deal with the company hasn't been without other drama. Forbes claimed in May that Jenner and associates forged financial records of the deal and removed Jenner from their billionaire's list. Jenner has disputed Forbes' reporting.

Read Seed's full complaint below:

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