Home / Thatchers unsuccessful in cider dispute with Aldi
26th January 2024
Trainee Solicitor, Tom Griffin looks into the dispute of Thatchers v Aldi.
In a much-anticipated judgment, the High Court has ruled in favour of Aldi in its trade mark dispute with Thatchers concerning their competing cloudy lemon cider products. Whilst an Aldi spokesperson declared that there is “nothing cloudy” about the decision, others have been left pondering a familiar question: how do Aldi and other discounter stores get away with selling ‘lookalike’ products?
In February 2020, having identified a gap in the fruit cider market for a citrus-based cider, Thatchers launched its canned cloudy lemon cider product. Thatchers shortly after obtained a UK trade mark registration (the “Registration”) for a device mark in respect of, amongst other goods, cider (the “Mark”). The Mark consists of the central wording “THATCHERS” and “CLOUDY LEMON CIDER” in large decorative font with “FAMILY CIDER MAKERS” arched above it and “ZINGY & REFRESHING” arched below it. The wording is against a creamy-yellow background and there are whole yellow lemons with quite large green leaves disposed around the top and left edge of the Mark.
Aldi sells its own cider products, the “Taurus” range, and third party cider products. It launched a cloudy lemon cider product in May 2022, which is sold as 4-can packs. The can is creamy-yellow and the central element is the wording “TAURUS”, which is above the wording “CLOUDY CIDER LEMON” and below a bull’s head. There are yellow, green and gold curves arcing both upwards and downwards from the bull’s head. There are also whole yellow lemons with small detached green leaves disposed around the top, bottom and left edge of the can. Lastly, at the bottom of the can is the wording “MADE WITH PREMIUM FRUIT” in small font.
It was not disputed by Aldi that they had used the Thatchers product as a benchmark. Evidence provided by one of Aldi’s witnesses set out that Aldi will often identify a market leader’s product when developing a similar product and this was accepted as standard market practice. The benchmarking was held to relate to quality and the packaging. At one point during the design process, Aldi instructed their external designers that they wanted to see “a hybrid of Thatchers and Taurus”.
Thatchers claimed that Aldi infringed the Registration pursuant to sections 10(2)(b) and 10(3) of the Trade Marks Act 1994 (“TMA”), as well as that Aldi was liable under the tort of passing off. As a preliminary point, it was necessary to identify the sign which was the subject of Thatchers complaint as this is what would be compared to the Mark. The sign was held to be, as opposed to the 4-can pack, a single can (the “Aldi Sign”).
Section 10(2)(b) TMA– no likelihood of confusion
In deciding that there was no likelihood of confusion on the part of the average consumer, three factors were important:
Whilst elements of visual similarity, such as the colour scheme of the Mark and the Aldi Sign, were noted, greater weight was given to the dissimilarity between the dominant part of the Mark, being the wording “THATCHERS” and “CLOUDY LEMON CIDER”, and the dominant part of the Aldi Sign, which was deemed to be the bull’s head and the wording “TAURUS”.
Despite the enhanced distinctiveness of the Mark, which had been acquired through use and extensive marketing, and significant sales of both products, there was no evidence of actual confusion of a direct or indirect nature.
The average consumer would browse for ciders and make a decision to purchase in a matter of seconds and, therefore, would be looking for visual clues from the shelf stand-out, including colour, to draw his attention and encourage him to purchase. The colour scheme was deemed ubiquitous to lemon-flavoured drinks and when the average consumer perused the cider shelves at Aldi, the overwhelming impression would be of the “Taurus” brand.
Section 10(3) TMA – no unfair advantage and no detriment to distinctive character or repute
Whilst it was deemed that the Aldi Sign would call the Mark to the mind of the average consumer, it was held that use of the Aldi Sign did not take unfair advantage of or cause detriment to the distinctive character or repute of the Mark.
In relation to unfair advantage, it was held that Aldi had endeavoured to adopt a sign which is a safe distance away from the Mark and, furthermore, there was not an intention to exploit the reputation and goodwill of the Mark and the use of the Aldi Sign did not have the effect of doing so.
After taking part in a blind taste test of the two products, the Judge concluded that there was a slight difference in the taste of the products. However, the Aldi product was not so different as to have a negative impact on the products sold by Thatchers under the Mark and resultingly, the Aldi Sign was not detrimental to the repute of the Mark.
In addition to the above, Thatchers also submitted that there was detriment to repute arising from the fact that although the Aldi Sign states that the Aldi product is “made from premium fruit”, it has no real lemon in it and so is deceptive to consumers. It was held that whilst this may result in consumers distrusting Aldi, there is no reason to suppose they will distrust Thatchers and there is, therefore, no detriment.
Passing Off – no misrepresentation
It was held that Aldi had not passed off by making misrepresentations leading the public, or likely to lead the public, to believe that the Aldi product is that of, licensed, or approved by, or otherwise connected in trade with Thatchers.
Comment
It was thought that if Thatchers succeeded in this case, the floodgates would open for others to pursue Aldi and other discount retailers for their ‘lookalike’ products. Whilst it seems that the floodgates are remaining closed for the time being, there is a real possibility that Thatchers will seek permission to appeal the decision. This is not least due to the wide scope of protection afforded to Lidl under the tort of passing off in its claim against Tesco last year, as well as its success in establishing trade mark infringement under s10(3) TMA on the basis of unfair advantage in the same case. That being said, the dispute between Lidl and Tesco is far from over as it appears that further appeals are likely.
If you any queries relating to trade mark registration, subsistence, infringement or revocation, please contact a member of our intellectual property department on 0161 832 3434.