Almost a year to the date of the decision in the Intellectual Property Enterprise Court (“IPEC”) Thatchers Cider Company Limited (“Thatchers”) has successfully won an appeal in an enduring trade mark battle with Aldi Stores Limited (“Aldi”) over Aldi’s cider product.
The Court of Appeal held that Aldi’s use of its “Sign”, referring to Aldi’s lookalike Taurus Cloudy Lemon Cider product’s packaging (both the graphics on the cans and on the cardboard 4-can pack) infringed Thatchers’ Cloudy Lemon Cider trade mark.
Whilst the original IPEC judgment offered comfort for supermarkets or other suppliers who may be looking to “benchmark” their discount lookalike brands or products against established brands, the Court of Appeal decision should give brand owners the victory and means of pursuing lookalikes that they have been looking for.
Background and IPEC ruling
Thatchers is the registered proprietor of UK trade mark number 3489711, for a device mark, registered in respect of “Cider; Alcoholic beverages, except beer” in class 33 (the “Trade Mark”). Thatchers claimed that Aldi infringed Thatchers’ Cloudy Lemon Cider trade mark with its lookalike product Taurus Cloudy Lemon Cider. Thatchers also claimed against Aldi for passing off with its lookalike cider product.
Thatchers argued that the overall appearance of Aldi’s Taurus Cloudy Lemon Cider is highly similar to that of Thatchers and that the Court should infer that Aldi intentionally imitated the appearance of Thatchers Cloudy Lemon Cider product in designing the appearance of Aldi’s Taurus Cloudy Lemon Cider product, and in doing so, Aldi intentionally set out to cause a link in the minds of consumers between the two products in order to encourage consumers to buy Aldi’s product; and Aldi took unfair advantage of, or caused detriment to, the distinctive character and repute of the trade mark, without due cause.
Aldi accepted and acknowledged that it used the Thatchers product as a ‘benchmark’ when developing its Taurus Cloudy Lemon Cider product but denied infringement of the trade mark. Further, in relation to Thatchers’ claim for passing off, Aldi’s defence was that none of the requirements of passing off were established.
The Court dismissed Thatchers’ claim and found that Aldi did not infringe the trade mark and was not liable in passing off.
The decision was in itself a matter of some debate amongst professionals and a disappointment for brand owners fighting lookalikes.
The appeal
On that note, Thatchers challenged the Court’s decision in relation to the dismissal of its claim under section 10(3) of the Trade Marks Act 1994, being that the overall appearance of Aldi’s Taurus Cloudy Lemon Cider is highly similar to that of Thatchers and Aldi took unfair advantage of, or caused detriment to, the distinctive character and repute of the trade mark, without due cause. Case law has already established nine conditions which must be satisfied in order for there to be a finding of infringement under section 10(3). However, the Court of Appeal only needed to address two of the nine, namely (a) it must give rise to a link in the mind of the consumer and (b) give rise to injury, namely unfair advantage or detriment to the repute of the trade mark.
The appeal was heard at the Court of Appeal on 17 and 18 December 2024 and judgment was handed down on 20 January 2025.
The Court of Appeal held that Aldi’s use of its “Sign” infringed the trade mark.
Against the backdrop of Aldi’s own evidence about the development of their product packaging, Lord Justice Arnold concluded that Aldi:
- intended its Sign to remind consumers of the Trade Mark in order to convey the message that the Aldi Taurus Cloudy Lemon Cider product was “like the Thatchers’ Cloudy Lemon Cider product, only cheaper”. The comments of consumers on social media were cited as evidence of the link in consumer minds; and
- took advantage of the reputation of the Trade Mark in order to assist it to sell its own product and this was an unfair advantage because it enabled Aldi to benefit from Thatcher’s efforts in its development and promotion of the Thatchers’ product rather than competing on the merits of Aldi’s own lemon cider product and promotional efforts.
Aldi argued that even if its use of its Sign fell within section 10(3) it had a defence under section 11(2)(b), namely that the elements of similarity are descriptive or otherwise non-distinctive and its use was in accordance with honest practices in industrial or commercial matters. Lord Justice Arnold concluded that it would not be correct to break the overall Sign used by Aldi into different parts in order to satisfy the requirements of section 11(2)(b) and that the use was not in accordance with honest practices in industrial and commercial practices “because it was unfair competition”.
The Birketts view
It is noted that a spokesperson for Aldi has stated that Aldi intends to appeal the Court of Appeal’s decision. However, in the meantime, the Court of Appeal judgment stands as does its potential impact.
There is no doubt that Thatchers’ choices in brand protection and strategy stood it in good stead. Had its strategy been only the registration of a word mark and its logo then this case and its outcome would, perhaps, have looked very different.
Will Aldi’s inbox now be filled with ‘letters before action’ from a plethora of brand owners? Perhaps, although the strength of those may depend on brand protection strategies.
It would be remiss to think that this only impacts on Aldi. We expect it will give cause to pause to all supermarkets when considering their own brand products and packaging development.
Further, the importance of keeping records of the evidence of consumers linking two products in their mind is demonstrated in this judgment. It is not just consumers that pick this up but also journalists, particularly on seasonal product articles. This type of evidence is ‘free’ to obtain and certainly does not involve expensive surveys or experts.
As a side note, paragraphs 142-151 are worth a read for arguments on not departing from an EU decision.
If you would like to discuss your own brand strategy or issues with lookalikes and copycats, please contact our team.
The full Court of Appeal decision (Thatchers v Aldi [2025] EWCA Civ 5) can be found here.
The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at January 2025.