Trade mark protection and management in an ideal world
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Supermarkets have certainly played their part of late in bringing intellectual property disputes into the public domain, with a number of high-profile intellectual property court cases making the headlines.
An end of the road for lookalikes?
Lidl’s spat with Tesco hit the headlines recently after Lidl filed a dramatically successful claim that Tesco’s Clubcard price logo infringed both their registered trade marks, and the copyright in their logo. Tesco was also found guilty of passing off. This gave hope to many brand owners that this could signal the beginning of the end of lookalike products, or at least that using similar marks to those of competitors, even marks comprising common or non-distinctive elements, had reached some kind of limit.
…or maybe not
Arguably the most high-profile cases in recent years concerning lookalike products have involved the German supermarket chain Aldi, well known for its propensity to sell products that have more than a passing resemblance to established and often well-known brands.
The latest decision concerns the Somerset cider maker Thatchers, who took action against Aldi for the alleged infringement of its trade mark Thatchers Cloudy Lemon Cider, registered at the UK Intellectual Property Office as a figurative mark.
As well as trade mark infringement, Thatchers claimed passing off, accusing Aldi of misrepresenting to the consumer that there was a commercial relationship between the parties, causing damage to Thatchers’ goodwill and brand reputation.
The case was watched keenly by UK brand owners, hoping for further guidance as to what is, and what is not allowed, in the world of copycats.
Background
Thatchers Cloudy Lemon Cider was launched in the UK in February 2020. The product packaging, shown below, was registered as a trade mark in August 2020. Aldi launched its own cloudy lemon cider in May 2022, under its trade mark TAURUS, registered in the UK since 1991.
Thatchers took exception to the Aldi product, alleging that the similarities between the packaging were deliberate on the part of Aldi, and that the similarities were such that there was a likelihood of confusion (Section 10(2)(b) of the Trade Marks Act 1994). Thatchers also claimed that Aldi was taking unfair advantage of the reputation in its trade mark, such that consumers would associate the products in such a way that they would be more inclined to buy the Aldi product (Section 10(3) of the Act).
The judgement
The Court noted that Aldi used the Thatchers product and packaging as a ‘benchmark’ when designing its own, but accepted on the basis of submissions from both parties that this was commonplace among retailers. While there was discussion about Aldi’s intentions during the development process, in particular, whether it developed packaging that deliberately leaned towards Thatchers’ style rather than remaining consistent with its own style used for its Taurus cider, the Court held that not only was the Aldi product consistent with its established style, but that Aldi’s intentions during the developmental stage were not relevant, concluding that the end product was not intended to take advantage of the reputation and goodwill in Thatcher’s trade mark.
It was agreed that Thatchers enjoys a tangible reputation in its registered trade mark, and that the packaging used by Aldi brought to mind Thatcher’s product, and therefore its registered trade mark. However, while comments on, for example, social media, stating that ‘the Aldi product was a ‘knock off’ of the Thatchers product’ were not considered favourable to Aldi, online discussions comparing the two products could not be taken as evidence of anything other than consumer awareness of both products. Ultimately, the Court held that, while the Aldi packaging was undoubtedly developed in order to attract customers, there was no evidence that the high sales enjoyed by Aldi resulted from the packaging similarities, or that it led to any changes to consumers’ economic behaviour. Thatchers’ claims that the similarities were intended to lure consumers into purchasing the Aldi product were therefore rejected.
Looking at the packaging in more detail, as this is key to the decision, and probably of most importance to brand owners watching this case, elements such as lemons and lemon leaves were accepted as being widely used on the packaging of lemon-flavoured beverages, while a yellow-green colour scheme effectively communicated ‘lemon’ to the consumer. The use of a prominent brand name followed by a description of the product, in this case ‘THATCHERS Cloudy Lemon Cider’, was acknowledged as not being a style to which Thatchers could claim any exclusivity.
Crucially, the main distinctive elements on both parties’ packaging – the registered trade marks THATCHERS and TAURUS – were found to be dissimilar. The overall similarity of the packaging of Thatchers’ and Aldi’s products, taking all elements into consideration, was low, and Aldi was accordingly found not to be benefiting from the reputation of Thatcher’s registered trade mark.
On the passing off claim, the Court agreed that Thatchers was the owner of goodwill in the product associated with the trade mark, but disagreed that Aldi had misrepresented to the consumer that there was a commercial link between the parties. The claim to passing off accordingly failed.
Our comments
When Thatchers initially brought their claim against Aldi, many hoped that, as there was no requirement under Section 10(3) of the Act to show a likelihood of confusion, it would lead to a different outcome. This could have been significant for the future of supermarket lookalike products, making it potentially easier for brand owners to block the seemingly relentless stream of similar products. Notable in this case is the significance of the lemon-related imagery and stylisation, arguably generic for the product, and this is a lesson in itself. That said, appeal is possible, so the latest Aldi copycat saga is not yet over.
Irrespective of the final outcome, decisions such as this should not deter brands from taking action to enforce their trade marks. It does however highlight the importance of protecting all aspects of packaging using both trade mark protection and, where possible, registered design protection. Brand owners can improve their position if they deliberately include distinctive elements of branding or design into their products and then register those because more distinctive elements can attract a broader scope of protection.
The full decision can be found here: https://www.bailii.org/ew/cases/EWHC/IPEC/2024/88.html
For more information and advice about how trade mark and design protection can help protect your brands, contact Liz Lowe or Fiona Jones.