In this article, we discuss two IP judgments involving the discount supermarket chain, Aldi. Both deal with the issue of supermarket look-alikes. The first one is a continuation of a well-known UK case, whereas the other case took place in Australia.
UK – Thatchers Cider v Aldi
We have discussed this case before and a quick summary is below:
The High Court – there will be no confusion
This highly-published case started its life in the UK High Court. The Court found that, despite similarities relating to the get-ups of Thatchers cider and Aldi's Taurus cider (see representations below), these were not such that there would be consumer confusion. This judgment was taken on appeal.
The Court of Appeal – there will be confusion
The Court of Appeal recently overruled the decision of the High Court and held that Aldi had almost certainly benefitted from mimicking Thatchers branding. The Court held that Aldi's product created a link with the Thatchers product in consumers' minds, and this link could lead to consumer confusion. Lord Justice Arnold said the following:
'The inescapable conclusion is that Aldi intended the Sign to remind consumers of the Trade Mark. This can only have been in order to convey the message that the Aldi Product was like the Thatchers Product, only cheaper. To that extent, Aldi intended to take advantage of the reputation of the Trade Mark in order to assist it to sell the Aldi Product'.'
A UK lawyer who's very much involved in matters of this kind, Geoff Steward, optimistically said this on LinkedIn: 'Armed with the correct packaging and trademark registrations, UK brand owners can now sound the death knell on the practice of supermarket own-brands free-riding on their brand IP.'
A further appeal
It seems that this matter is not over yet. Aldi's response to the latest judgment is forthright: 'We think the Court of Appeal's decision is wrong and we intend to appeal...the High Court was clear that Aldi customers know what they are buying when they shop with us.'
It's clear from the judgment that the Court of Appeal was very aware of the fact that there are big issues at stake here, such as competition and pricing. These words from the judgment are interesting:
'The Court is aware that this case has attracted attention amongst commentators in the field of trade mark law. Some have criticized the judge's decision as illustrating an alleged failure on the part of UK law properly to protect brand owners against so-called look-alike' packaging, while others have commended it as upholding competition and hence cheaper prices for consumers.'
Policy and law
The Court of Appeal made it clear that there is a clear distinction between policy and law:
'It is not the function of this court to enter into these policy debates. Our task is to apply the law enacted by Parliament to the facts of this case. This point is particularly significant because, as I will explain later in this judgment, Aldi invites us, if necessary, to depart from the leading judgment of the Court of Justice of the European Union in this field.'
It's likely that we will be discussing this case for some time.
Australia – Little Bellies
In Australia, there is a baby and snack food brand called Little Bellies. This brand is owned by a company called Hampden Holdings I.P. The company brought a copyright infringement case against the budget retailer Aldi in respect of artistic works used on the packaging of the Bellies brand of products.
Some background
The Bellies brand was created by two brothers in Australia, seemingly because one of the brothers has a child with serious food allergies. We're told that the creation of this brand was not simply a case of a company 'copying the vibe of packaging' - au contraire, the brand 'speaks to everything the company has worked so hard to represent through their brand image and messaging'. We're further told that Little Bellies is the market leader in the segment.
Benchmark
Aldi made an interesting and major concession – it admitted that its process for designing artwork for private label packaging involves choosing a leading brand as the benchmark, and in this case, the benchmark brand was Little Bellies.
The judgment
Judge Moshinsky said that he was 'satisfied that Aldi deliberately developed packaging... that resembled the packaging of the BELLIES puff products'. In doing 'Aldi sought to use for its own commercial advantage the designs that had been developed by a trade rival.'
This was a high-stakes game: 'Although Aldi may have intended, if possible, to avoid infringement and legal liability, it took the risk that its use of the BELLIES designs would exceed what the law allows.'
And there were consequences: 'I consider Aldi's conduct to be flagrant. Further, I consider that an award of additional damages is appropriate to deter similar infringements of copyright.'
Go the little guys!
Hampden Holdings MD Clive Sher had this to say about the judgment: 'This is a landmark court case for Australia in a true David v Goliath story.' Whereas the UK IP attorney quoted earlier in the article was also clearly pleased with the result – he said this on LinkedIn:
'Creativity should always be rewarded. Lovely brand, lovely result.'
Some supermarkets may be wondering if the tide is turning!
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