Lidl vs Tesco Copyright Claim: The Entire Case and Timeline

If 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 considered whether Tesco Supermarket’s use of a yellow circle on a blue rectangle in its ‘Clubcard’ branding constituted passing off Lidl’s core branding intellectual property.

Background to the copyright claim

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.

Court of Appeal Judgment Decision

The Court of Appeal delivered a mixed verdict.

• Copyright Infringement Claim Rejected: The Court found that the basic graphic elements of Lidl’s logo—a simple yellow circle on a blue square—did not amount to a copyright-protectable work. The design lacked the requisite originality, and Tesco’s usage was not considered a reproduction of any protectable artistic expression.
• Trademark and Passing Off Claims: While the focus of this latest appeal was on the copyright aspect, it’s worth noting that the original High Court decision had found Tesco liable for trademark infringement and passing off—an outcome not directly overturned by this ruling.

Events Following the Decision

Tesco were ultimately ordered to rebrand its branding designs for its Clubcard pricing. Tesco moved from a yellow circle in blue rectangle to side-by-side blue and yellow rectangles. The estimated cost of this rebranding was £8 million.

Key Takeaways

Simplicity and Originality: Basic geometric shapes and colours, unless presented in a particularly original and creative way, are unlikely to attract copyright protection.

Brand Distinction: This case underscores the importance of distinctive and well-documented branding, not only for marketing purposes but also to defend legal rights effectively.

Legal Strategy: The outcome offers a useful reminder that copyright is not always the most effective route in brand protection cases. Trademark law may provide more robust coverage in cases of consumer confusion or brand misappropriation.

Timeline of Events

• 2020: Tesco launches new branding for its Clubcard Prices loyalty scheme, using a yellow circle displaying the price, on a blue rectangular background.
• 2020: Lidl issues proceedings, alleging trade mark infrindgement, ‘passing off’ and copyright infringement.
• 2023: High Court (Joanna Smith J) delivers a judgment in favour of Lidl, finding Tesco liable for trade mark infringement, passing off and copyright infringement. It also finds Lidl’s ‘Wordless Mark’ design invalid for ‘bad faith’ decision.
• 2023: High Court supplemental judgment grands injunction against Tesco for copyright infringement, pending appeal.
• 2024: Court of Appeal hands down judgment, upholding the High Court’s findings on trademark infringement and passing off. Court of Appeal allows Tesco’s appeal on copyright.
• 2024: Tesco ordered to rebrand its Clubcard Prices branding designs, said to cost the firm approximately £8 million.

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.