Not long after a trade mark dispute between supermarkets M&S and Aldi filled social media and newspapers headlines with pictures of Colin the Caterpillar, another supermarket has found itself in the middle of a legal dispute around a lookalike trade mark.

The latest dispute involves Scottish brand owner of Hendrick’s Gin William Grant & Sons (WGS) and German supermarket Lidl.

The dispute

Hendrick’s Gin is known among customers for its apothecary-style bottle and diamond-shaped label, the latter being protected in the UK by a registered trade mark (UK00910544575) filed in January 2012.

Lidl have their own label gin, branded as “Hampstead Gin”. In December 2020, a re-designed version of Hampstead Gin appeared in UK Lidl stores (photo on page 4 of Lord Clatke’s opinion).

The new Hampstead Gin soon caught the attention of William Grant & Sons, as well of some consumers who wrote on social media posts on the lines of:

“Hmmm…Reminds me of another gin, but I just can’t put my finger on it…” – followed by laughing emojis

“Looks like a complete rip off of Hendricks!!”

“Looks like it’s meant to be a direct copy of Hendricks which doesn’t have cucumber in it, it is the suggested serve and heavily marketed that way”

and more can be read in the judge’s opinion.

In April 2021 WGS launched legal proceedings against Lidl at the Scottish Court of Session (SCOS) on three grounds:

  • that the new Hampstead Gin caused a likelihood of confusion among consumers, contrary to section 10(2) of the Trade Marks Act 1994;
  • that Lidl was committing an act of passing-off under common law; and
  • that Lidl was taking unfair advantage of the reputation and distinctive character of the Hendrick’s Gin trade mark, contrary to section 10(3) of the TMA.

At a preliminary hearing on May 25, Lord Clarke granted an interim interdict which forced Lidl to withdraw all newly designed bottles from Scottish stores.

Lord Clarke’s decision

After considering all arguments brought forwards by the parties, Lord Clarke was of the opinion that there was no prima facie case for the first two grounds (likelihood of confusion  and passing off ) but there was a prima facie case in respect of the third (unfair advantage).

With regards to ground 1) and 2) Lord Clarke agreed that, despite the existence of some dissimilarities, there was some visual and conceptual similarity between the Hendrick’s trade mark and the new Hampstead sign and that social media and YouTube material submitted by WGS provided support for this theory. However, Lord Clarke concluded that whilst the average consumer will perceive the similarities between the two products, factors such as the distinguishable names on the labels, the place where Hampstead gin is sold (Lidl stores) and the difference in price, in addition to the existing dissimilarities in the getup, do not support a claim for passing off nor a claim that there would be a likelihood of confusion about the origin of the products. This was also supported by the same social media posts submitted by WGS which showed the authors were aware of the correct provenience of Hampstead Gin.

With regards to the third claim, instead, Lord Clark agreed that WGS had a reasonable prospect of success in showing that the defenders intended to benefit from the reputation and goodwill of their mark and in showing that there was a change in economic behaviour or a real likelihood of such a change by customers who buy from Lidl, and therefore the new Hampstead Gin had created an unfair advantage. Lord Clarke commented: “whether or not there was a deliberate intention to deceive, there is a sufficient basis for showing that there was an intention to benefit”.

The balance of convenience

When considering interim interdicts, courts take into account the balance of convenience, that is, whether the inconvenience or prejudice caused to the pursuer if the interim interdict is not granted outweighs the inconvenience or prejudice cause to the defender if the interim is granted.

In this case Lord Clarke concluded that the balance was in favour of WGS, since Lidl could continue to supply its Hampstead Gin using the older design, which they have readily available. Moreover, if the interim interdict was refused but WGS would win at trial, damage to Hendrick’s gin could be significant and difficult to quantify, whereas in the opposite scenario it would be much easier for the court to quantify Lidl’s losses arising from the interdict.

Conclusions

This is only the setup of the case and we look forward to seeing how the situation will evolve, however it is interesting to see first of all that, although Lord Clarke acknowledged the limited importance of evidence from social media, it is evident these can now play an important role in establishing the point of view of the “average consumer”; and, secondly, that the Scottish IP Court have once again confirmed themselves as a generally right-holder-“friendly” forum for IP disputes where it is somewhat faster and easier to raise proceedings and obtain an interim interdict as compared to the onerous obligations which are in force in England and Wales.

 

 

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