The Court of Appeal has ruled on a dispute between supermarket giants Lidl and Tesco, upholding the decision of the High Court that signs used in a promotion run by Tesco amounted to trade mark infringement and passing off.

In September 2020, Tesco began using signs featuring text within a yellow circle on a blue background as part of its ‘Clubcard Prices’ promotion, which offers reduced prices to shoppers who are Tesco Clubcard holders. The signs appeared in Tesco’s stores, on its website and in advertisements. Lidl, whose logo also features a yellow circle on a blue background, claimed that Tesco’s use of the signs constituted trade mark infringement, passing off and copyright infringement.

After considering evidence including messages from consumers and research conducted by external agencies, the High Court concluded that the average consumer would draw a link between the Clubcard Prices signs and Lidl’s trade mark, and that there was clear evidence of confusion as to whether prices on the signs had been matched with Lidl’s prices. Lidl’s trade mark infringement claim was upheld. In also upholding the claim for passing off, the Court rejected Tesco’s argument that the Clubcard Prices signs were exclusively addressed to Tesco shoppers, finding that they would also be seen by many people who shopped elsewhere. The Court also ruled that Tesco had infringed the copyright in Lidl’s logo.

Ruling on Tesco’s appeal against the High Court’s judgment, the Court of Appeal reversed the decision on copyright infringement, holding that although the relevant version of Lidl’s logo was sufficiently original for copyright protection to apply, Tesco had not copied the elements that made it original. However, the High Court’s findings of trade mark infringement and passing off were open to it on the evidence.