Cider maker Thatchers has succeeded in its appeal against budget supermarket Aldi for trade mark infringement over its cloudy lemon cider.
Thatchers claimed Aldi had infringed its trade mark as the overall appearance of Aldi’s cloudy lemon cider in its Taurus range was ‘highly similar’ to the Somerset-based cider brand’s canned cloudy lemon cider. The case was dismissed at the High Court in January last year which Thatchers appealed.
The Court of Appeal has now allowed Thatchers appeal and substituted a finding that Aldi has infringed the trade mark.
In lead judgment, Lord Justice Arnold, with whom Lord Justice Phillips and Lady Justice Falk agreed, said it was ‘plain from a comparison between the sign and the trade mark that the former closely resembles the latter’. He added that third-party products, both lemon-flavoured ciders, alcohol and soft drinks, ‘demonstrate that it is entirely possible to convey the message that a beverage is lemon-flavoured without such a close resemblance, and therefore the resemblance cannot be coincidental’.
The judgment said the ‘inescapable conclusion’ of Aldi’s departure from its house style for Taurus ciders ‘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.’
Read more
The judgment said Aldi was able to achieve ‘substantial sales’ of its cloudy lemon cider in 'without spending a penny on promoting it’ and in the ‘absence of evidence that Aldi would have achieved equivalent sales’ without the use of the sign and without consumers making a link between it and Thatchers, ‘it is a legitimate inference that Aldi thereby obtained the advantage from the use of the sign that it intended to obtain’.
It added: ‘That was an unfair advantage because it enabled Aldi to profit from Thatchers’ investment in developing and promoting the Thatchers product rather than competing purely on quality and/or price and on its own promotional efforts.’
The judgment agreed with Thatchers' submission that the High Court judge 'was obviously wrong to find that Aldi had not significantly departed from its house style for Taurus ciders’. Overall, it concluded that 'Aldi’s use of the sign was not in accordance with honest practices in industrial and commercial matters because it was unfair competition.
IP specialists said the ruling had implications beyond the drinks business. Mary Bagnall, head of IP at Charles Russell Speechlys, said ‘This decision should act as a warning to discount supermarkets, who are looking to launch competing products to established brands, that they cannot expect to adopt lookalike packaging which rides on the coattails of other companies’ marketing and advertising efforts without significant repercussions.’
Richard May, IP partner at Osborne Clarke, said the judgment was a ‘victory for innovation’. He added: ‘It should make it easier for brands with a reputation to attack lookalike products, particularly against outlets who routinely engage in this kind of copycat behaviour.’
Jeremy Hertzog, partner and chair Mishcon de Reya’s innovation department, said: ‘Businesses offering “lookalike” products should heed the judgment as a warning that taking advantage of another brand’s image and reputation in this way can amount to trade mark infringement, even if the marks are not confusingly similar.’
Peter Vaughan, chartered trade mark attorney and associate professor at Nottingham Law School, added: ‘There is a fine line between legitimate packaging and packaging that comes too close. This decision means that the line has now become finer and parties may have to exercise more caution in both their product design and benchmarking.’
5 Readers' comments