Every Lidl Doesn’t Help

All the way back in 2020, the prominent transnational German supermarket Lidl, known for its selection of high quality products at discounted prices, commenced a lawsuit against UK supermarket titans Tesco. Three years later, a long-awaited High Court ruling has secured victory for Lidl, with the Judge finding that Tesco has infringed their trade marks and copyright.

The dispute erupted in the wake of Tesco launching a new ‘Clubcard Prices’ loyalty programme with promotion featuring the use of a yellow circle against a blue background. Lidl deemed this to be too similar in appearance to their own trademarked colour scheme and logo configuration and claimed this was a sly attempt to swindle consumers into thinking its prices were comparable. Lawyers for Lidl argued that Tesco had deliberately infringed their copyright and ‘taken unfair advantage’ of their reputation for low prices.

High Court Judgement

High Court Judge Joanna Smith concluded that Tesco’s use of the same yellow and blue colour scheme for their Clubcard Prices signage infringed Lidl’s trade mark rights as they are detrimental to the distinctive character of the Lidl logo. Furthermore, Tesco was found to be taking unfair advantage of their discount rival’s reputation with the use of these logos likely deceiving a substantial number of customers into assuming that their prices were comparable.

In particular, the Judge noted that the fact that so many members of the public had sent unprompted messages to both Tesco and Lidl questioning a perceived link between the two logos weighed strongly in Lidl’s favour, as this evidenced Lidl’s claim that Tesco were duping customers into thinking there were similar prices between them. The Judge further accepted Lidl’s assertion that this infringement equated to dilution of their brand, a claim which was unchallenged by Tesco.

Finally, the Judge was notably critical of Tesco’s evidence as to how the Clubcard Prices logo was created, suggesting that their evidence was not only inaccurate, but an attempt to obscure the involvement of their external design team.

Overall, the High Court ruling is clear; Tesco had infringed Lidl’s copyright.

Berry Smith Comment

The prominence and public nature of these supermarket giants means that this case is likely to be one of the most high profile cases in trade mark and IP law in 2023. Unlike in typical trade mark infringement claims, where there may be evidence of confusion between two brands as a result of the infringement, this case differed in that Tesco was found guilty of taking unfair advantage of Lidl’s reputation through using the similar logo to suggest an equivalence between the brands in terms of low prices.

Ironically, Lidl’s victory may be rather short lived, as the repercussions of a decision that makes it more difficult to suggest equivalence through similarity in logos or colour schemes, for example, are likely to come back to bite the discounter, who are known for their large range of ‘copycat’ products.

Nevertheless, the novel findings of this case could have a profound impact on future IP law, with the potential for further similar claims based on a similar suggested equivalence, rather than direct confusion. With this in mind, Berry Smith’s commercial team can provide comprehensive advice on UK trade marks and IP protection and exploitation, helping you safeguard your intellectual property while maximising its potential.

Please contact us if you would like more information about the issues raised in this article or any other aspect of Commercial law at 029 2034 5511 or commercial@berrysmith.com