Tesco has lost a high court appeal with rival grocer Lidl over its use of a yellow circle to promote its Clubcard branding. The original ruling that found the logo to be in breach of Lidl’s trademark was upheld.
The development follows a High Court ruling last year that the grocery giant had taken ‘unfair advantage’ of the German discounter’s established reputation for low prices.
Tesco will now have nine weeks to remove the ‘Clubcard Prices’ logo from all of its stores and online channels, which is set to cost it an estimated £8 million.
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The UK’s largest supermarket chain filed the appeal last month after expressing strong dissatisfaction with last year’s ruling, deeming it an “inappropriate remedy”.
On the ruling, a Lidl spokesperson said: “Last year, the High Court ruled that Tesco’s Clubcard logo was copied from ours and infringed our trademark rights, allowing them to unfairly benefit from our longstanding reputation for value while misleading its customers.
“Despite this, Tesco prolonged the dispute by appealing, deceiving customers for another year.
“Therefore, we are delighted to see that the Court of Appeal has now agreed with the High Court that Tesco’s use of its Clubcard logo is unlawful. We expect Tesco now to respect the court’s decision and change its Clubcard logo to one that is not designed to look like ours.”
In response, a Tesco spokesperson said: “Our customers always tell us just how important Clubcard Prices are to giving them great value – and it’s been a key reason why we’re consistently the cheapest full-line grocer.”
“We are disappointed with the judgment relating to the colour and shape of the Clubcard Prices logo but would like to reassure customers that it will in no way impact our Clubcard Prices program.
“Clubcard Prices, irrespective of its logo, will continue to play a central role in rewarding our Clubcard members with thousands of deals every week.”
Although the court of appeal backed the judge’s original ruling that the Clubcard logo had infringed Lidl’s trademark, it overturned an original decision on copyright, which had been made in Tesco’s favour.
Having traditionally built its brand image around a yellow circle on a blue background, Lidl has since become inextricably linked to the visual pattern. The original ruling did however reject that the Clubcard logo had “the deliberate subjective intention of riding on Lidl’s coat tails”.
