This claim, in its early stages in the IPEC caught our eye. The parties, direct competitors of each other, are UK suppliers of exhibition stands. XL Displays (XL) in its claim alleges that Display Wizard (Wizard) has breached its copyright in a series of images used on XL's website, across its social media platforms, and in online marketing, advertisements and email campaigns. It does not claim that direct copies have been reutilised, but that there's been a "substantial reproduction" of those images.
The eye catching element is Wizard's response as outlined in its defence. By way of an example, it claims that one of its employees copied one of the images referred to in the dispute to create an image for use by Wizard. But it says that "[XL's] images were used as the starting point to create [Wizard's] images, using AI and/or manual manipulation, the amendments were made in order to create an image which accurately reflected [Wizard's] product. "[XL's] images were used for nothing more than reproducing the general layout of a generic underlying product."
Points of interest from the claim and the defence
XL will have to prove that copyright exists in the images and that they own it. This is rarely straightforward – key cases on copyright in photographs have made it clear that simply pressing a button isn't enough to obtain copyright protection. There must be a "photographic work" where individual choices have been made regarding visual angles, light, exposure, and composition. XL have set out their case on copyright subsistence and "originality", qualification and ownership but they can expect it to be attacked at every level. Weaknesses are often identified when setting out the title to copyright when photographs have been created by different people with different employment statuses (employees, directors, and independent contractors), at different times. There's no surprise to see various confirmatory assignments referred to in XL's claim, all dated in 2026 later than the date of the alleged infringing activity. This is something best dealt with at the time of creation of the work – when commissioning the works and/or developing them in house when the information is fresh and the key players are in situ and onside.
Predictably, Wizard in denying the claim, say that distinctive features in the images, relied on by XL, are not distinctive or original but are routine, industry standard features used in product photography and renders. Wizard also maintains that the images are essentially representations of generic exhibition hardware (often manufactured by third parties) which must accurately reflect the underlying products. However, the fact that Wizard admits that in many cases, Wizard's employees did use XL’s images as a “starting point” but then altered them using AI and manual edits means that disclosure will involve the release of all relevant documents evidencing that process, including key instructions and the prompts used in the AI tool (where available). XL will be looking for a smoking gun or a smoking prompt.
XL have joined three of Wizard's directors to the claim. XL alleges (by inference) that these directors each took a central role in Wizard's operations and must have authorised or procured the alleged infringements (or acted in common design) and are therefore jointly liable with Wizard. Following Lifestyle Equities v Ahmed (see our analysis), claims of accessory liability are still likely to be brought against directors, if not only to create settlement leverage or to mitigate against the risk of defendant company insolvency. This can make the litigation more complex, widening disclosure and witness evidence demands – with the directors' communications under increased scrutiny, making this more difficult operationally and psychologically for them.
Early takeaways from XL
Retail and consumer facing businesses increasingly sell through image led journeys: product pages, paid socials, Google Shopping feeds and email campaigns. That speed and scale can be a growth driver, but it also means an image provenance issue can multiply quickly across channels.
As XL argues in its claim, editing a copyright protected work does not change the position on whether a substantial part of the original has been copied. Practically, that means rebranding, colour changes, background swaps, and other such edits may not de-risk an image if the workflow started with a competitor’s (or other third-party) content and there is no relevant licence in place. Using AI to edit or rework a third party image does not remove intellectual property infringement risk (our AI guide explains why). It may in fact make a finding of infringement more likely, depending on the contents of the prompts used to make the edits. Without admission of liability, Wizard have removed some of the images from their website.
However, an image on a product page can quickly reappear in paid socials, CRM systems, on marketplaces and in shopping feeds. This may engage additional rights and remedies (for example, allegations of broader “communication to the public”, takedown demands, and disputes about scale and intent). When an image is challenged, it may be advisable to remove or replace it everywhere it appears. In practice, that can mean pausing campaigns, refreshing feeds, updating CRM journeys and marketplace content, and coordinating teams and agencies, already under significant time pressure.
The case is XL Displays Ltd. v. Display Wizard Ltd. and others, case number IP-2026-000048, in the Intellectual Property Enterprise Court.
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