Oscar Wilde (1854-1900) dismissed imitation as “…the sincerest form of flattery that mediocrity can pay to greatness.” If, however, a competitor copies your work and passes it off as their own, you may feel less than flattered. This is where the tort of passing off comes in.
The Court of Appeal in London recently considered whether one supermarket chain’s use of a yellow circle on a blue rectangle constituted passing off another’s intellectual property.
Background
The German supermarket chain Lidl owns several UK trademarks. Since 1987, it has used “the Wordless Mark” – comprising a yellow circle on a blue background – and “the Mark with Test” – with the addition of the brand name.
Since 2000, Tesco has used similar branding for its Clubcard Prices loyalty scheme. Lidl claimed that this was confusingly similar and could mislead customers into believing the products were associated. Tesco counterclaimed, alleging Lidl’s registration of the Wordless Mark was invalid, registered in bad faith, and lacking in distinctive character.
Judgment
The Court of Appeal delivered a mixed verdict. Tesco successfully challenged the copyright claim, with the court finding that Lidl’s logo lacked sufficient originality for copyright protection. However, Lidl prevailed on the more crucial issues of trademark infringement and passing off.
Consumer surveys conducted by Tesco themselves indicated a risk of confusion, further strengthening Lidl’s case. Tesco was found liable for both trademark infringement and passing off and will be prohibited from using the yellow circle within a blue square design for its Clubcard.
The judgment also addressed the validity of Lidl’s trademark registrations. Tesco had argued that Lidl registered their logos in bad faith, aiming to gain a monopoly on simple colour combinations. The Court of Appeal rejected this, upholding the validity of Lidl’s trademarks.
Comment
It is all about perception. Even if you believe your branding to be sufficiently different, customer surveys and market research may evidence the contrary. To avoid challenges, you may need to invest more in creating unique and memorable visual identities. By prioritizing clear differentiation and conducting thorough market research, you can mitigate the risk of becoming the subject matter of this blog!
For more information about this article or any other aspect of intellectual property, contact your Napthens Solicitors in Preston, Liverpool, Blackburn, and across the North West today.
