The Memo: Lidl accuses Tesco of deception in dispute over yellow circle logo

Chelsey Stanborough – 20 February 2023

Like the caterpillar themed chocolate cake that is nostalgic for Brits everywhere, a trademarked yellow circle logo has created a new dispute between two of the UK’s largest supermarkets. The German discount producer Lidl accused Tesco of ‘riding its coattails’ with their ‘Clubcard offers for loyalty members’ logo and filed a lawsuit. In November last year, Tesco argued that Lidl had trademarked the logo in ‘bad faith’ and won the permission to dispute it. The yellow circle, Tesco argues, will create difficulties for Lidl in its attempts to establish that the logo involves enough artistic skill and originality to comprise its intellectual property and win damages.

The case brings to the forefront the trademark of shapes and colours. As it stands, trademark infringements rest on the likelihood of consumer confusion, whether it’s similarities between logos, the goods and services themselves, or the reputation of the logo and the legitimacy that comes with it. In this case, Lidl claims that the trademark yellow circle and blue background is an important part of their brand (with or without the Lidl name). If the yellow circle and blue background have indeed become attached to the brand, then it’s up to courts to decide whether Tesco’s Clubcard campaign would cause consumer confusion.

Aspiring intellectual property lawyers should not only read up on these domestic matters, but keep their eyes peeled for similar cases overseas too. In fact, according to records from the World Intellectual Property Organization, the USA has the highest number of trademark infringement cases of any country in the world. Recent examples from across the pond include Adidas’ claim that Forever 21’s use of three black stripes on a design constituted an attempt to sell similar style products with subpar quality, and have sunk millions of dollars to protect the trademark.

For UK consumers however, your biggest concern might be remembering to bring your Clubcard to pay 50p less for your Tesco Meal Deal at lunchtime. After all, every Lidl helps!

For more information about intellectual property law, you can view our IP practice area guide here.