M&S festive gin sinks Aldi in ‘lookalike’ case

Supermarket wins rare copycat decision over discounter rival | Win ‘offers hope’ to registered design owners battling against ‘lookalike’ products | Decision serves as a warning against discounters’ ‘high-cost strategy’.

Marks & Spencer has prevailed against Aldi at the Court of Appeal of England and Wales in its dispute over the designs for its festive range of ‘light-up gin bottles’.

In a decision delivered today, Lord Justice Richard Arnold dismissed Aldi's appeal and ruled that the German discounter had infringed Marks & Spencer's rights.

The legal battle between the two supermarket chains emerged three years ago, with this latest development following a High Court decision in February 2023 that found against Aldi.

Christmas light-up gin bottle

The registered designs at the heart of the case protect a product range for Christmas introduced by M&S in the autumn of 2020.

Consisting of gin-based flavoured liqueurs sold in a festively-decorated bottle, they contain edible gold flakes which become suspended in the liquid when the bottle is shaken, producing an appearance akin to that of a golden snow globe.

In the base of the bottle, there is a light-emitting diode (LED) that, when turned on, illuminates the contents of the bottle, and the gold flakes if they have been shaken up. The flavours included clementine.

In November 2021, Aldi launched a rival gin-based flavoured liqueur product range sold in a decorated bottle containing gold flakes and an LED. There were two flavours—clementine and blackberry— sold in bottles with different colours.

On appeal, Aldi argued that the High Court had failed to properly consider the impact of the absence of the snow effect and the integrated light in Aldi’s products.

Secondly, it contended that the judge had given undue weight to the shapes of the bottles and stoppers, particularly given that the shape of the bottle was protected by a third party registered design and that the design corpus included bottles with similar stoppers.

However, Arnold rejected these arguments, stating that “the weight to be given to the shape of the bottles and the stopper was a matter for the judge as part of his overall assessment”.

“He made no error of principle in comparing the overall impressions of the Aldi products with those of the registered designs, and his conclusion was one that he was fully entitled to reach,” concluded Arnold.

‘Novel’ wins the day

Commenting on the judgment, Louise Popple, senior counsel, knowledge, at Taylor Wessing described it as a significant victory for M&S, “not just against Aldi—which M&S also battled in the Colin the Caterpillar dispute–but all who produce lookalike products”.

“The High Court held earlier that the cumulative similarities between Aldi's product and M&S's registered designs was ‘striking’. The Court of Appeal rejected Aldi's appeal. Anyone who compares the designs won't be surprised by this outcome.”

However, she cautioned that these types of cases “are never an easy victory” for brand owners.

“Here, the depiction and description of M&S' design registrations were picked over by Aldi but ultimately the court held that they were clear and that account could be taken of goods marketed that correspond to the design.”

M&S was helped by the fact that its bottle design was novel, she added, because there was no reason why Aldi should get so close to its rival’s designs “given there is considerable design freedom for these types of bottles”.

Difference to Thatchers’ dispute

She contrasted the outcome to that experienced by cider brand Thatchers in its own unsuccessful suit against Aldi.

“Where packaging consists of more generic elements as was partly the case in the recent Thatcher's v Aldi case, then the outcome might be different.”

The case is also significant because it clarifies several areas of design law that were somewhat unclear, added Poppel.

“There has been a significant uptick in the number of lookalike cases, especially involving supermarkets, going to court, which perhaps shows brand owners’ increasing confidence in these actions.

“Further actions are in the pipeline including a recently filed action by Tesco against Lidl plus the appeal of the action Lidl brought against Tesco for the latter's use of a yellow circle on a blue square.”

Registered designs gain power

Peter Nunn, partner at Mishcon de Reya, surmised that the Court of Appeal’s decision will encourage registered design owners to bring enforcement actions against ‘lookalike’ products.

“A product's get-up (packaging, shape and style etc) can be protected by both trademarks and registered designs.

“Both are desirable, but registered designs are cheaper, quicker and simpler to obtain, and it is often easier to show that they have been infringed. The Court of Appeal's decision shows the value of considering design registration protection for products and their get-up.”

Crucially, the Court of Appeal found that other variants of the registered design—which may have been disclosed by the designer in the one year grace period it has to apply to register a design after releasing it—do not constitute “prior art” against which the novelty of the design is assessed.

“Had it been found that they did, this would have greatly curtailed the utility of the one–year grace period for organisations which release variations on the design before deciding which is most valuable (as M&S had).”

Richard May, IP partner at Osborne Clarke, lauded the judgment as “the right decision”, especially in the wake of Thatchers.

“It confirms the scope of the 12-month grace period is slightly wider than we thought.  Designers do have freedom to test the market by disclosing different variations of a design in the grace period before deciding which variant to register—previously there was a question mark over whether disclosing different variants would narrow the scope of protection.

“Now we know that it won't, which is great news, provided those variants are broadly the same design. It emphasises that registered designs are a very useful form of protection against lookalike products and rights holders can achieve success with the right case.”

Brand owners, he advised, should create “a thicket” of registered rights around products by registering designs as well as trademarks in the fight against lookalikes.

“The strength of registered designs is that the informed user is considered to be more observant than the average consumer in trademark law.”

For John Coldham, partner at Gowling WLG, registered designs are often “an underused weapon” in these types of disputes.

“I hope it reminds brand owners to consider design law more carefully when developing their brand protection strategies. This case was an appeal by Aldi against the High Court decision, but it was rejected by the Court of Appeal, confirming the strength of designs as a form of attack in these sorts of cases.”

While Popple predicted that low cost and supermarket own brands “will no doubt continue to fly close to the wind”–especially where there is a significant financial incentive for doing so– she warns that this decision highlights that “it is a high-cost strategy when they overstep the mark”.

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