Thatchers v Aldi: Court of Appeal Upholds Trade Mark Protections for Established Brands

On 20^th January 2025, the Court of Appeal ruled in favour of Thatchers Cider Company Limited (“Thatchers”) in a landmark trade mark infringement case against the discount supermarket chain, Aldi Stores Limited (“Aldi”). This decision overturned the earlier ruling by the Intellectual Property Enterprise Court (“IPEC”) and has been eagerly awaited by UK trade mark lawyers up and down the country.

The case centred on Aldi’s, “Taurus Cloudy Lemon Cider”, which Thatchers argued closely imitated the packaging of its own Cloudy Lemon Cider. The Court of Appeal’s decision is a significant win for brand owners, discouraging supermarkets and retailers from adopting designs that take unfair advantage of well-known trade marks.

Background

Founded in 1904, Thatchers is one of the UK’s leading independent cider producers. Thatchers can be described as a household name, and one with significant goodwill and reputation in the UK. In February 2020, Thatchers launched a new flavour of cider- cloudy lemon. Prior to launching, Thatchers applied for a UK trade mark to protect the cloudy lemon packaging, and this was successfully registered under trademark number 3489711 on 14 May 2020 (trade mark shown below).

Between 2020 and 2023, Thatchers invested over £3 million in advertising their cloudy lemon cider, and achieved significant returns on their marketing endeavours, making more than £20 million in sales by September 2022.

Aldi has sold cider under the brand name “Taurus” since 2013 and launched their Taurus cloudy lemon cider in May 2022 (displayed below).

On 22 September 2022, Thatchers commenced proceedings against Aldi for infringement of their registered trade mark pursuant to Section 10(2) and (3) of the Trade Marks Act 1994. The legislation is as follows:

(2) A person infringes a registered trade mark if he uses in the course of trade a sign where because—

(a) the sign is identical with the trade mark and is used in relation to goods or services similar to those for which the trade mark is registered, or

(b) the sign is similar to the trade mark and is used in relation to goods or services identical with or similar to those for which the trade mark is registered,

there exists a likelihood of confusion on the part of the public, which includes the likelihood of association with the trade mark.

(3) A person infringes a registered trade mark if he uses in the course of trade [in relation to goods or services,] a sign which—

(a) is identical with or similar to the trade mark;

 (b) where the trade mark has a reputation in the United Kingdom and the use of the sign, being without due cause, takes unfair advantage of, or is detrimental to, the distinctive character or the repute of the trade mark.

Thatchers also argued the tort of passing off, claiming that Aldi’s design misrepresented a connection between the two brands, misleading consumers and causing damage to Thatchers.

IPEC Ruling

In January 2024, IPEC ruled in Aldi’s favour, finding that there was, overall, a low degree of similarity between Thatchers’ cloudy lemon cider trade mark and Aldi’s Taurus cloudy lemon cider packaging. The court also determined that Aldi had neither taken unfair advantage of Thatchers’ goodwill and reputation nor caused any detriment to its trade mark. Furthermore, there was no misrepresentation by Aldi in the context of passing off.

The judge placed significant weight on the distinguishing elements in Aldi’s design, particularly the use of the bull’s head logo, concluding that this was sufficient to differentiate Aldi’s product from Thatchers’.

Court of Appeal Decision

Thatchers appealed IPEC’s dismissal of its claim under Section10(3) Trade Marks Act 1994, which provides extended protection for trade marks with a reputation in the United Kingdom. This section prohibits the use of a similar mark where, without due cause, it takes unfair advantage of or causes detriment to the distinctive character or reputation of the registered trade mark.

The Court of Appeal took a different view, concluding that there was sufficient evidence to suggest consumers were associating the two products, leading to confusion. While Aldi argued that the use of lemons was a common design choice for lemon-flavoured drinks, the court found that the overall impression of the packaging design- including the arrangement of lemons and leaves- was excessively similar to that of Thatchers’. The court further requested Aldi provide a “due cause” justification for designing its product in such a similar manner, but Aldi was unable to do so.

Implications and Next Steps

Aldi has sailed close to the wind on several occasions in the past with lookalike products and on this occasion has tested the court’s interpretation of S.10(3) Trade Marks Act 1994.

The Court of Appeal’s decision has been welcomed by many established brand owners, who have long faced challenges from supermarkets selling lookalike products at lower prices.

Discount supermarkets have often defended such designs by arguing that consumers are aware these products are not made by the original brand. However, this ruling reinforces the value of trade mark registration and the legal protections it affords against imitation.

Aldi has indicated its intention to appeal to the Supreme Court and trade mark litigation lawyers will continue to monitor the case closely. For now, though, this represents a significant victory for established brands and a potential shift in the legal landscape concerning supermarket own-brand packaging.