Lidl v Tesco: price war showdown

Tesco launched through now familiar TV advertising, a marketing campaign offering Tesco CLUBCARD members money off selected goods at the point of sale.

For the promotion, Tesco selected a logo comprising a yellow circle on a blue square background bearing overlaid text like “Clubcard Prices”:

Tesco knew they were operating close to the line.  Prior to the launch Tesco had commissioned third party research that identified the potential through use by Tesco of the proposed yellow/blue logo of both source and price match confusion with the LIDL yellow/blue logo secured by registered trade mark protection including in the UK:

Despite concerns voiced internally, the Tesco “Clubcard Prices” campaign went ahead.

Lidl sued Tesco for the extended form of registered trade mark infringement through taking advantage without due cause of the undoubted reputation for keen prices enjoyed by the LIDL yellow/blue logo mark.

Given evidence before the court of the findings of the marketing research conducted on behalf of Tesco, the reservations expressed internally by the Tesco marketing team and also oral evidence from members of the public that the yellow/blue “Clubcard Prices” logo caused them to make the required “link” with Lidl, the court unsurprisingly found in Lidl’s favour.

The sting in the tail for Lidl was, on a counterclaim by Tesco, loss of Lidl’s yellow/blue WORDLESS logo registered trade mark:

The court held that Lidl had applied for registration of the yellow/blue WORDLESS logo in bad faith because at the relevant times (this mark had been applied for on more than one occasion) Lidl had no intention to use it for the goods/services concerned.  Instead, Lidl unlawfully sought (through registration of the yellow/blue WORDLESS logo) to widen the scope of the monopoly in the LIDL yellow/blue logo with text.  Paradoxically though Lidl was found by the court to have used the yellow/blue WORDLESS logo through use of the LIDL yellow/blue logo with text.

This piece was written and researched by Tristan Morse. For further information, email our specialist trade marks team at tristan@humphreys.law or fill in the form below.

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