In September 2023 and January 2024, we wrote about a legal claim brought before the English courts by Thatchers Cider Company against Aldi Stores.
At first instance Aldi won but, unless a settlement is reached beforehand, an appeal against that decision will be heard by the Court of Appeal this December.
Since February 2020 Thatchers have sold in the UK a cloudy lemon cider product, with the following packaging design, which it has registered as a UK trade mark:
Thatchers claim the product has been highly successful and that the registered trade mark for the packaging has acquired a reputation in the UK.
Thatchers object to the appearance and sale by Aldi, since 2022, of the following cloudy lemon cider:
Thatchers claim the overall appearance of the Aldi product is highly similar to that of the Thatchers product sold under the registered trade mark, and that it is far more similar in appearance than other third party cloudy lemon cider products on the UK market.
Further, in adopting the appearance of the Aldi product, Aldi intentionally set out to cause a link in the minds of consumers between the Aldi product and the Thatchers product, in order to encourage customers to buy the Aldi products and thereby benefit from that link.
Thatchers assert that what Aldi has done is, inter alia, contrary to section 10(3) of the Trade Mark Act 1994.
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Pursuant to section 10(3) of the Trade Mark Act 1994, a person can infringe a registered trade mark if, where the trade mark has a reputation in the United Kingdom:
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No misrepresentation or likelihood of confusion is necessary to succeed with a section 10(3) infringement claim. In other words, consumers do not need to be confused into thinking that the Aldi product is the Thatchers product, or that Thatchers is in some way involved in its production.
In particular, Thatchers allege that the appearance of the Aldi product ‘free-rides’ off the reputation of Thatchers registered trade mark, in order to benefit from its power of attraction, fame and/or prestige, exploiting the marketing effort expended by Thatchers and transferring the image of the Thatchers cider product and registered trade mark to the Aldi product and its appearance.
In other words, the similarity in appearance is intended by Aldi to make its product more attractive to consumers, so as to influence their economic behaviour away from the Thatcher product and towards the Aldi product, with them being led to think that the similar packaging means the Aldi product has equivalent qualities to the Thatcher’s product.
But, as Lord Justice Jacob LJ has said in the past, there is no tort of non-infringement. A party may sail as close to the wind as they like, as long as they remain on the right side of the law.
The court held that Aldi used Thatchers product packaging as a benchmark for the packaging of its own product.
It also held that Thatchers registered trade mark had a reputation throughout the UK and, due to the extensive nationwide use that Thatchers had made of it, the mark had enhanced distinctiveness.
Furthermore, Aldi’s packaging called to mind Thatchers registered trade mark.
Despite these factors, the judge concluded that, the overall appearance of the Aldi product was only similar to Thatchers’ registered trade mark to a low degree and Aldi’s packaging did not ‘free-ride’ off the reputation of Thatchers registered trade mark. An important factor was the adoption of dissimilar brand names for the products: Thatchers and Taurus. This meant there had been no ‘subtle but insidious transfer of image’ from the Thatchers registered trade mark for its cider product packaging to Aldi’s product packaging, nor of the characteristics/qualities which the Thatchers product projects.
The appeal papers filed by the parties are not publicly available materials, so I do not know the submissions that Thatchers, or Aldi, will be making at the appeal hearing.
Case law is clear that, absent an error of law, an appellate court is only justified in concluding that the decision of a lower court is wrong if the judge's conclusion was outside the bounds within which reasonable disagreement is possible.
Where a case concerns multi-factorial decisions, of the type which were made in this case by the first instance judge, involving the weighing of several factors against each other, an appeal court should show a real reluctance to interfere in the absence of a distinct and material error of principle. Special caution is required before overturning such decisions.
So, put bluntly, Thatchers face an uphill battle to win on appeal. But that does not mean they can’t and won’t.
If the appeal succeeds then it might encourage other brand owners to bring cases against supermarket ‘look-a-likes’, whose own brand products packaging, as John Noble of the British Brands Group once said, can sometimes be ‘unnecessarily similar’ in appearance to that of the market leading brand owners product packaging.
That begs the question: why market and sell own brand products in product packaging similar in appearance to that of the market leading brand owners products? Could it be to try to convince consumers to associate their goods as having the same qualities and characteristics as the market leading brand owners products?
Thatchers might have succeeded at first instance if they had presented behavioural science evidence before the first instance court, showing that consumers are influenced in their purchasing decisions as much (if not more) by the colour, shape and overall design and appearance of a product’s packaging, as they are by the brand name of the product.
It’s unlikely that the appeal court would allow such evidence to be filed now, on appeal, when it could have been filed before the first instance court gave its judgment on the merits. Such evidence exists and could have been presented to the court, assuming the court was willing to consider it.
Furthermore, my personal view is that Thatchers got it wrong at the outset. They failed to register as a UK trade mark the 3D appearance of one of their cans of cloudy lemon cider. Instead they registered only a 2D image mark. Arguably, the former would have given a stronger level of protection against imitators of its product packaging.
We will report of the outcome of the appeal hearing in due course, assuming it takes place. So, watch this space. The battle isn’t over yet…
For more information please contact Carl Steele.
