by AF Newco claims that it flagged the practice to Wayfair in an August 2025 demand letter
WILMINGTON, Del. — AF Newco, the company that emerged when buying American Freight stores out of bankruptcy, has filed a complaint against Wayfair in federal court in Delaware, accusing the e-commerce giant of using American Freight’s brand names to lure shoppers to its own site.
This is the second time in three years Wayfair has been taken to court over the alleged use of American Freight marks.
AF Newco filed a trademark infringement and unfair competition lawsuit citing trademark law against Wayfair last month in the U.S. District Court for the District of Delaware, a complaint that centers on American Freight’s Stewart & Hamilton mattress line. The Stewart & Hamilton brand is sold exclusively through American Freight’s own stores and website. The complaint alleges that Wayfair has been quietly coding its site to hijack searches for the brand.
A Google search for “stewart and hamilton” or “stewart and hamilton mattress” returns a Wayfair listing advertising a “Stewart And Hamilton Excelsior Mattress,” a product Wayfair does not actually sell and a product American Freight has never authorized Wayfair to distribute, according to the filing. Clicking through leads to a Wayfair search results page stocked with thousands of unrelated mattresses from other brands, the complaint alleges.
Wayfair is not among American Freight’s suppliers or retail partners.
Rinse and repeat
AF Newco claims that it flagged the practice to Wayfair in an August 2025 demand letter. Wayfair’s counsel responded in December, and again in January, characterizing the search results as organic listings generated by Google’s algorithm rather than anything Wayfair had engineered. But, American Freight’s complaint says an inspection of the Wayfair site’s underlying code tells a different story: The page’s meta description tag was written to read, “Shop Wayfair for the best Stewart And Hamilton Mattress. Enjoy Free Shipping on most stuff, even big stuff,” the complaint states, further claiming that only a human at Wayfair could have written such language. American Freight states that it sent Wayfair the evidence in mid-January and never got a response.
The complaint recounts a nearly identical dispute in 2023, when American Freight was owned by Franchise Group. The complaint then alleged that Wayfair had been using the “American Freight” name in search listings, inviting shoppers to “Shop Wayfair for the best american freight mattresses” alongside pages for American Freight beds, sofas, chaise lounges and rugs.
In the new complaint, American Freight also points to a separate, still-pending case against Wayfair brought by Darvin Furniture & Appliance in federal court in Illinois that claims the same tactic with Darvin’s trademarks. The infringement is a pattern, therefore, and not a glitch, American Freight argues.
Also filed, as an exhibit, are the trademark registrations “American Freight” and “Stewart & Hamilton,” the latter incontestable since 2005.
Citing 15 U.S.C. § 1121, the company is asking the court for a permanent injunction barring Wayfair from using either mark, Wayfair’s profits tied to the alleged infringement, damages up to triple the actual amount, and attorneys’ fees.
AF Newco acquired American Freight and associated intellectual property out of Franchise Group’s Chapter 11 bankruptcy, buying roughly 31 stores for approximately $1.12 million. FRG and AF Newco recently stood down after going toe-to-toe in an escalating adversary judicial proceeding that saw each side claiming breach-of-contract over a lapsed transition services agreement, among other matters.
The reorganized debtor FRG and AF Newco agreed to drop their lawsuits in April, filing a joint stipulation of dismissal in the U.S. Bankruptcy Court for the District of Delaware. FRG fired the first shot in September 2025, suing AF Newco for breach of contract beginning in May of that year.
AF Newco hit back a month later, filing counterclaims that it amended in November. The company argued the opposite, which is that the agreement or contract had simply expired, leaving AF Newco with no remaining obligations. AF Newco then went on offense, seeking at least $673,000 in damages for breach of the agreement and claiming missing inventory. In the end, both sides simply withdrew their claims.
Separately, a company tied to AF Newco’s leadership, Phonix RBS, sued Buddy Mac Holdings, once the largest franchisee group for Franchise Group’s Buddy’s Home Furnishings chain, over a defaulted loan worth more than $12 million. Ultimately, that action landed AF Newco principals with control of roughly 43 additional furniture stores, most of them re-branded as Max Home Furnishings.
AF Newco reunited Michael Piper and Brent Turner, once executives with Liberty Tax, the company that became Franchise Group, along with Brian Kahn, the CEO of Franchise Group when it filed Chapter 11.
Sex discrimination
In 2022, as an FRG company, American Freight agreed to pay $5 million and provide job opportunities to women previously denied them, among other relief, to settle a federal nationwide sex discrimination lawsuit brought by the U.S. Equal Employment Opportunity Commission, according to the EEOC.
American Freight had engaged in a nationwide pattern or practice of sex discrimination against qualified female job applicants for sales and warehouse jobs at the company’s retail stores since 2013, according to the agency, which asserted violated Title VII of the Civil Rights Act of 1964.
The result of a lawsuit brought by the EEOC against American Freight in U.S. District Court for the Northern District of Alabama, Southern Division, was a three-year consent decree settling the suit and prohibiting American Freight from discriminating against any job applicant on the basis of sex and from engaging in retaliation.
“Refusing to hire women, either because of sex-based stereotypes or simply because they are female, is illegal,” said Marsha Rucker, regional attorney for the EEOC’s Birmingham District.
At the time, American Freight had 350 stores located in 40 states and Puerto Rico.
