Partial victory for Aldi at top Irish court
The Irish Supreme Court has delivered a mixed verdict in a trademark infringement suit brought by German supermarket Aldi against Irish competitor Dunnes Stores.
In its judgment, issued Wednesday, May 28, the Supreme Court ruled that a lower court had erred in finding that certain comparative advertisements deployed by Dunnes were misleading.
But the Supreme Court also ruled that two of Dunnes’ ads, which bore Aldi’s logo by way of comparison, were misleading and therefore infringed the German supermarket’s trademark.
Dunnes ran a small advertising campaign in 2013, aimed at drawing comparisons between its own products and those of competitors including Aldi, Lidl and Tesco.
The campaign consisted of banners and shelf-edge labels (labels that are used in retail environments to display information about products and are usually slotted into a data strip on shelves).
One example cited by the Supreme Court included a label which read “Dunnes rich and creamy yoghurt, 4 x 125g”, bearing the Dunnes price of €1.99 ($2.21) and another sticker indicating that the product was the same price in an Aldi store in Dublin.
In Dunnes’ campaign, 15 specific comparison shelf-edge labels (SCLs) were accompanied by the words “Aldi match” to indicate that the Dunnes product was the same price as a specific Aldi product.
Dunnes also featured numerous other shelf-edge labels (SELs) which bore the slogans “lower price guarantee” and “always better value”, accompanied by a downward arrow and the words “Aldi match”, the Supreme Court judgment said.
Aldi sued Dunnes in 2013, claiming that the comparative ads were misleading as its products were not comparable with Dunnes’.
In 2015, the Irish High Court ruled in favour of Aldi, finding that the comparative ads were unlawful. This decision was reversed by the Irish Court of Appeal in 2017, prompting Aldi to seek a review of the case at the Supreme Court.
In its judgment, the Supreme Court noted that comparative advertising was permitted under a 2007 statute which implemented the EU’s Directive 2006/114/EC into Irish law. According to the court, the use of another party’s trademark in comparative advertising was permitted if the ads were accurate and did not mislead the consumer.
The court rejected Aldi’s claims that ads for products such as ketchup, yoghurt, shower gel and a sparkling orange drink were unlawful and infringed the German supermarket’s trademark.
In its judgment, the court concluded that the SEL ads and all but two SCLs ads didn’t mislead consumers and served to highlight differences between the products, which is permitted under Irish law.
However, the court also ruled that two of Dunnes’ SCLs relating to toilet paper and anti-wrinkle day cream were impermissible as the Dunnes and Aldi products in question were not comparable.
Dunnes’ toilet paper was shorter in length than the Aldi product, while the day creams sold in each store had a different sun protection factor, according to the Supreme Court.
As these SCLs ads didn’t constitute permitted comparative advertising, Dunnes’ use of Aldi’s marks in these cases amounted to trademark infringement, the Supreme Court ruled.
Justice Donal O’Donnell, on behalf of the court, said: “It is probable that this case was so hotly contested because the supermarket business is highly competitive. Heavy advertising is the norm, and comparative advertising is potentially a key battleground.”
He added: “Even so, the length of time and effort involved in the determination of this case is quite disproportionate to the significance and intrinsic complexity of the cause of action involved, and it will, I hope, be possible to offer some guidance to permit speedier, more streamlined, and efficient determination of claims under the 2007 Regulations in the future.”
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