Three Landmark Decisions Reshaping UK Trademark Law

1. Clarifying Post-Sale Confusion:  The Supreme Court in Iconix v. Dream Pairs affirmed that trademark infringement can occur after purchase, requiring courts to consider consumer perception beyond the point of sale. 
2.  AI and Trademark Liability:  In Getty Images v. Stability AI,  the court found limited trade mark infringement involving watermarked synthetic images and emphasized that liability in generative AI depends on specific circumstances, such as user prompts and model design.
3. Brand Imitation Under Section 10(3):  The Court of Appeals in Thatchers v. Aldi held that using similar packaging to benefit from brand reputation constitutes infringement. 

Iconix v. Dream Pairs: Supreme Court Clarifies Post-Sale Confusion

The UK Supreme Court's ruling in Iconix Luxembourg Holdings SARL v. Dream Pairs Europe Inc ([2025] UKSC 25) is a landmark decision on the scope of trade mark infringement under section 10(2) of the Trade Marks Act 1994 (‘TMA'), in relation to post-sale confusion.

Iconix, owner of the Umbro brand and its iconic double-diamond logo, alleged that Dream Pairs' logo on football boots infringed its trade mark. The High Court dismissed the claim, finding only a very low degree of similarity and no likelihood of confusion. The Court of Appeal reversed the decision, holding that the High Court's assessment was “irrational” and concluded that moderately high similarity existed between the mark and the sign, in post-sale contexts, such as when boots were worn by others, creating a likelihood of confusion.

The Supreme Court unanimously allowed Dream Pairs' appeal, restoring the High Court's decision. Importantly, the Supreme Court confirmed that post-sale confusion is a legitimate basis for infringement, even if it does not influence future purchasing decisions. The confusion itself constitutes actionable harm.

The judgment also clarified that similarity assessments must consider “realistic and representative” post-sale circumstances, including viewing angles and consumer perception after purchase. This nuanced approach reflects how consumers encounter brands in real life and strengthens brand owners' ability to rely on post-sale confusion, while highlighting the evidential burden in proving such claims.

Getty Images v. Stability AI: Trade Marks in the GenAI Era

The High Court's decision in Getty Images v. Stability AI ([2025] EWHC 2863) is the UK's first major judgment addressing trade mark infringement in the context of generative AI. Getty alleged infringement under sections 10(1), 10(2) and 10(3) of the TMA, claiming that watermarks identical or similar to its registered marks: GETTY IMAGES and iSTOCK, appeared in outputs generated by Stability's Stable Diffusion model.

The court found “historic” and “extremely limited” instances of infringement under sections 10(1) and 10(2), but rejected the section 10(3) claim and declined to rule on passing off. Stability was refused permission to appeal.

A key feature of the judgment was its granular approach, assessing infringement on a version-by-version basis. Earlier iterations of Stable Diffusion were more likely to produce watermarked outputs, while later versions incorporated stronger filtering mechanisms. This technical analysis underscores the complexity of applying trade mark law to evolving AI models.

Getty's reliance on experimental prompts was partly criticised as contrived, though the court accepted that generic prompts such as “news photo” and “vector art” were representative of real-world use.

The court confirmed that Stability's conduct amounted to “use in the course of trade”, noting that watermark appearance was driven by Stability's design choices rather than user intent. This finding may have broader implications for future GenAI disputes, particularly where outputs incorporate third-party trade marks. Arguments on dilution, tarnishment and free-riding under section 10(3) failed due to lack of evidence of consumer behaviour change, signalling the high threshold for such claims.

Thatchers v. Aldi: Court of Appeal Reaffirms Protection Against Lookalikes

The Court of Appeal's ruling in Thatchers Cider Company Ltd v. Aldi Stores Ltd ([2025] EWCA Civ 5) marks a significant development in extended trade mark protection under section 10(3) of the TMA. Thatchers alleged that Aldi's Taurus Cloudy Lemon Cider packaging infringed its figurative mark for its own product get-up.

The Intellectual Property Enterprise Court dismissed the claim, finding no likelihood of confusion and rejecting arguments of unfair advantage. The Court of Appeal overturned this decision, holding that Aldi had taken unfair advantage of Thatchers' trade mark. Lord Justice Arnold emphasised that Aldi's design choices which included departing from its usual Taurus branding and incorporating elements reminiscent of Thatchers' packaging, were intended to create a link in consumers' minds. This allowed Aldi to “ride on the coat-tails” of Thatchers' reputation, achieving rapid sales without equivalent marketing investment. Such conduct was deemed contrary to honest commercial practices.

Crucially, the judgment confirmed that section 10(3) does not require confusion; creating a mental association and exploiting brand reputation suffices. Aldi's descriptive use defence under section 11(2)(b) failed, as similarities went beyond mere description. The Supreme Court later refused Aldi's permission to appeal, cementing this as a leading authority on lookalike packaging and unfair advantage.

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