Aldi gets limited declarations from Supreme Court in Dunnes row

A lengthy legal row between Aldi and Dunnes Stores over an in-store labelling campaign by the Irish retailer has ended with the German discounter getting limited declarations from the Supreme Court of impermissible comparative advertising infringing Aldi's trade mark concerning toilet rolls, a day cream, and use of certain in-store banners.

Because Aldi’s toilet rolls were longer than Dunnes, and Aldi’s “anti-wrinkle” day cream had a sun protection factor of 6 when Dunnes had none, they were misleadingly compared with Dunnes products, the five-judge court said.

It rejected Aldi’s claims of unlawful comparative advertising and trademark infringement concerning 13 other products including tomato ketchup, strawberry yoghurt, shower gel and certain pet food.

Dunnes had not disputed a finding that certain in-store banners comparing Dunnes products to Aldi’s, and using slogans like “lower price guarantee”, were unlawful comparative advertising.

The Supreme Court judgment concerned Aldi’s appeal against a judgment of the Court of Appeal which overturned a range of High Court findings in favour of Aldi.

Aldi also appealed the appeals court decision awarding 60 per cent of the entire legal costs to Dunnes as the court considered it was the “substantial victor” in the litigation.

On Tuesday, a five-judge Supreme Court upheld most of the Court of Appeal findings except concerning the toilet rolls and day cream. It will decide costs issues later.

The case concerned whether a summer 2013 price advertising campaign by Dunnes, which used Aldi’s trademarks for comparison purposes, complied with conditions imposed by the European Commission (Misleading and Comparative Marketing Communications) Regulations 2007.

Giving the detailed judgment, Mr Justice O’Donnell said this was a comparatively small advertising campaign, costing about €22,000 across all Dunnes’ stores, and such advertising was permitted if it complied with the 2007 Regulations.

Shelf-edge labels

Aldi’s case concerned 15 specific comparison shelf-edge labels (SELs) by which Dunnes drew specific comparison with Aldi products; banners used in store with words including “lower price guarantee” and “Aldi match”; and a large number of other shelf-edge labels (SELs), using slogans such as “lower price guarantee” and “Aldi match”.

Aldi alleged it was an illegal advertising campaign under the 2007 Regulations and it won in the High Court on almost every aspect of its case after a 17-day hearing, the judge said.

The High Court judgment was later reversed by the Court of Appeal.

Having analysed the legal framework and evidence, Mr Justice O’Donnell said the CoA correctly found the comprehensive High Court finding in favour of Aldi was based on a misinterpretation and consequently a misapplication of the law.

Having considered all 15 SELs, he found 13 of those were not misleading.

He found the SELs regarding two products – toilet rolls and a day cream –were misleading and therefore impermissible comparative advertising under the 2007 Regulations.

The SELs complained of were not misleading, he held. He disagreed with Aldi that slogans accompanying the prices displayed may suggest, even where the prices were identical, the Dunnes price was somehow lower.

He agreed with the Court of Appeal the slogans cannot, or should not, be understood in that way and said he did not consider the average consumer would treat the vague slogans as overriding the specific information which was very clearly presented.

It was not necessary to grant a permanent injunction restraining a repetition of the limited breaches of the 2007 regulations which the court had found, he also held.

Noting the long and expensive litigation, he said the judgment provides guidance to permit speedier and more streamlined determination of similar cases under the 2007 Regulations.