Lidl and Tesco square up in UK court logo battle

German discounter claims that Tesco has used a blue square with a centred yellow circle to promote its Clubcard scheme, which is too similar to its own

Tesco in the UK is being sued by rival retailer Lidl.

Lidl has accused Tesco of “deceiving customers” during a High Court battle in the UK over the use of a yellow circle logo.

The German discounter is suing Tesco for infringement, passing off and copyright, claiming that the UK’s largest supermarket has used a blue square with a centred yellow circle to promote its Clubcard scheme, which is too similar to its own.

At the beginning of the civil trial on Tuesday, Lidl alleged that Tesco’s use of the logo was part of a wider “price war” waged against discount retailers, which has caused confusion among consumers.

Tesco is vigorously defending the lawsuit and has brought a counterclaim against Lidl seeking to cancel some of the trade marks.

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Benet Brandreth KC, barrister for Lidl, said that the two images were similar and a “consequence of similarities is that a substantial number of consumers are being deceived”.

He added: “However, Lidl says that this deception is not accidental – that Tesco deliberately copied Lidl’s branding to achieve precisely the transfer of reputation for good value that is occurring.”

In the past decade German discounters Lidl and Aldi have taken increasing share in the UK grocery market, although Tesco has around 26 per cent of the market. In 2015, Lidl had 3.5 per cent of the UK market and 600 stores but by 2022 it had 7.2 per cent with 920 stores, the trial heard.

Tesco’s barrister Hugh Cuddigan KC claimed that there is “no significant similarity” between its Clubcard prices sign and Lidl’s logo.

Tesco alleged that Lidl’s main trademark claim was “without merit”. It said that when the supermarket received feedback about its Clubcard promotions there was only a modest association with Lidl, and Tesco “was behaving fairly”.

“It would have been anathema to Tesco to allow the Clubcard brand and the new loyalty discount scheme to be muddied or polluted by association with any of Tesco’s competitors,” the supermarket chain said.

Tesco claimed that to win its case Lidl “must prove not merely confusion” among consumers but deception.

“That means that the customers who have been misled would otherwise have gone to Lidl to purchase the goods in issue, or that the deception causes them to take a materially disadvantageous view of Lidl,” Cuddigan added. “We are not aware of any evidence that this has happened.”

Tesco and Lidl would not comment further on the court case. The case continues. – Copyright The Financial Times Limited 2023