Lidl-Tesco battle shows securing brand is vital

Lidl and Tesco clashed over the latter's Clubcard Prices logo, says Kirsty StewartLidl and Tesco clashed over the latter's Clubcard Prices logo, says Kirsty Stewart
Lidl and Tesco clashed over the latter's Clubcard Prices logo, says Kirsty Stewart
Protecting intellectual property remains key for businesses

The recent tussle between Tesco and Lidl over Tesco’s Clubcard Prices logo, which Lidl successfully argued was too similar to its famous blue and yellow design, has underlined the importance of securing your brand.

Legally, a brand is anything that identifies and distinguishes the goods and services offered by one business from those offered by another.

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Company names, product or service names, logos and slogans are the most common examples of a brand – and whether you realise it or not, if you have customers, you have a brand.

A strong, healthy brand is a key cornerstone of success, helping to win trust, and attract customers, staff and investment. Therefore, it is vital that businesses take the matter of brand protection extremely seriously.

Trade marks are the main type of intellectual property used to protect a brand. While unregistered trade marks exist automatically, registered rights are much stronger. Businesses with brands under threat will find it easier to defend them if registered because it is only necessary to show a third party is using a similar brand for similar products or services. This was the case for Lidl in its legal battle against Tesco.

In the case of unregistered trade marks, rights will be built up over time through use of the brand and as an organisation’s reputation and goodwill in the relevant marketplace grows.

Unregistered trade marks are a useful tool for many businesses, but those that require to defend their trade mark rights will need to demonstrate they have established goodwill, that a third party has made a misrepresentation in relation to the brand and that they have or are likely to suffer damage as a result of that misrepresentation.

At Thorntons we have developed a specialist unit to support businesses seeking to register their trade marks and protect their intellectual property.

For those just setting out, it is necessary to have a filing strategy. Businesses must identify the key brands they need to protect, the relevant products and services involved, and their target customers and marketplaces. As trade marks are jurisdictional, businesses must apply on a territory by territory basis or consider wider protection. For example, the EU operates a single trade mark which offers protection in all 28 Member States in a single registration. For those who trade further afield, WIPO (the World Intellectual Property Office) administers an ‘International Trademark’. This is not a single trade mark as the name suggests but rather a ‘bundle’ of national rights, a facility that enables entities to submit trade mark applications to many countries at the same time.

To avoid inadvertently copying an existing trade mark businesses should conduct checks of trade marks registers and complete a wider review of other sources such as Companies House, domain registries, social media and general internet searches to ensure that their chosen brand is available and nothing similar is already being used. This will help to prevent any issues from third parties when trying to register or launch a brand into the marketplace. The more memorable and distinct a brand is, the more it will stand out in the market and create a foundation for growth.

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Finally, and crucially, once a trade mark has been established and registered it is important to renew it. Failing to renew trade mark registrations in time can have cost implications. More seriously, there is a risk of losing rights in the mark and being forced to make a new application which can jeopardise historical rights and future brand identity.

Kirsty Stewart is a Partner, Thorntons