Aldi Stores (Ireland) Ltd and Another v Dunnes Stores
| Jurisdiction | Ireland |
| Judge | MR JUSTICE CREGAN |
| Judgment Date | 09 June 2015 |
| Neutral Citation | [2015] IEHC 495 |
| Docket Number | [2013 No. 13177 P] |
| Court | High Court |
| Date | 09 June 2015 |
[2015] IEHC 495
THE HIGH COURT
COMMERCIAL
Cregan J.
[2013 No. 13177 P]
Intellectual Property Rights – Trademarks – Infringement – EU Directive 114/2006/EC – Per genus et per differentiam – The European Communities (Misleading and Comparative Advertising) Regulations 2007 – The Consumer Protection Act 2007 – Injunction
Facts: The plaintiffs sought an injunction to restrain the defendant from infringing the plaintiffs' trademarks. The plaintiffs also sought an order for damages caused by the defendant by engaging in unlawful comparative advertisements in relation to certain products. The plaintiffs alleged that the defendant by displaying the items of the plaintiffs alongside defendant's products under the term 'shelf-edge label' on a shelf in the defendant's supermarkets and giving wrong information about rate, price and volume of the plaintiffs' items incorrectly compared the plaintiffs' products as the two were not comparable. The plaintiffs contended that the defendant by displaying the plaintiffs' items containing plaintiffs' trademarks and words 'Aldi match,' and 'lower price guarantee' in the defendant's supermarkets contravened the European Communities (Misleading and Comparative Advertising) Regulations 2007 as they mislead the consumer that the family essentials available in defendant's supermarkets were cheaper than those of plaintiffs'. The defendant contended that the display of plaintiffs' items were part of 'Lower Price Guarantee' campaign and intended to inform the consumers that the price of defendant's commodities were reduced as compared to other brands including the plaintiffs'.
Mr. Justice Cregan concluded that the advertising strategies adopted by the defendant were clearly in violation of regs. 4 (2) (b), 4(2) (c) and 4 (2) (d) of the European Communities (Misleading and Comparative Advertising) Regulations 2007. The Court also concluded that comparative advertisements techniques applied by the defendant were in contravention of ss. 43- 46 of the Consumer Protection Act 2007. The Court reserved its right to grant appropriate orders after full submission from the parties. The Court held that there were five cornerstones of comparison comprising quality, provenance, nature, substance and quantity. The Court observed that the ingredients of each product were material, relevant and representative features in a comparative analysis. The Court held that the relevant test for reg. 4 (2) (b) of the said Regulations 2007 to deal with 'misleading commercial practices' was set out under ss. 43 (1) & (2) and s. 46 of the Consumer Protection Act 2007 which was whether false, misleading or deceptive information had been given, withheld, omitted or concealed. The Court opined that it was an objective test from the perspective of an average consumer that would likely cause him to act on such misinformation. The Court opined that the term 'average consumer' would mean a well informed, reasonably observant and circumspect consumer, who must be disclosed all the relevant information by the defendant. The Court found that the defendant must meet all the conditions set out under art. 4 of the EU Directive 114/2006/EC before any of its comparative advertisement shall be permitted and those conditions were cumulative, and if any one of the conditions was infringed, the comparative advertisement would be prohibited. The Court discerned that the 'Lower Price Guarantee' scheme adopted by the defendant was a sham and a devise to falsely induce the consumers that the products sold by defendant definitely guarantee lower price than that of plaintiffs', and hence, comprised unlawful advertising practices.
Introduction 3
The parties 5
The issues 5
The nature of the plaintiffs' complaints 5
The trademarks 7
Summary of evidence for Aldi 8
Summary of Dunnes Stores Evidence 14
The effectiveness of the campaign 19
Directive 2006/114/EC on misleading and comparative 21 advertising
The European Communities (Misleading and Comparative Advertising 25 Communications) Regulations 2007 ( S.I. 774/2007)
The Consumer Protection Act 2007 – Sections 42- 46 27
The objectives of the Comparative Advertising Directive 30
Review of case- law 31
The burden of proof 45
Introduction 49
The Expert Witnesses 50
Methodology of the plaintiffs' and defendant's experts 51
The 15 products 56
The effectiveness of the campaign 88
Introduction 93
Do shelf- edge labels comply with Regulation 4 (2) (d)? 94
What is the relevant test for Regulation 4 (2) (d)? 95
Do shelf- edge labels infringe Regulation 4 (2) (d)? 96
Do shelf- edge labels comply with Regulation 4 (2) (c)? 101
The relevant test under Regulation 4 (2) (c) 101
Do shelf- edge labels infringe Regulation 4 (2) (b)? 103
Analysis of Sections 43- 46 of the Consumer Protection Act 103
The appropriate test 105
Infringement of sections 43- 46 of the Consumer Protection Act? 108
Do the banners comply with Regulation 4 (2) (d)? 110
Do the banners infringe Regulation 4 (2) (c)? 114
Are the banners misleading under ss. 43- 46 of the Consumer Protection Act? 114
Do the shelf- edge labels infringe Regulation 4 (2) (d)? 117
Do the shelf- edge labels infringe Regulation 4 (2) (c)? 120
Do the shelf- edge labels infringe Regulation 4 (2) (b)? 121
The average consumer 122
'Significantly affect' a significant number of consumers 124
The requirement for interchangability 130
Requirements of Directive are cumulative 131
The principle of proportionality 132
The public interest 132
Infringement of trademark 133
Observations on Irish Regulations 138
It is often said that one cannot compare apples and oranges. This is because they are regarded as entirely different 'things' and therefore, as a matter of logic, any comparison between them is meaningless. However, of course, that is only half the truth. At a higher level of generality, one can indeed compare apples and oranges. They are both fruit and they are both edible foodstuffs. Yet what they have in common seems to miss the essential point. It is how they are different that makes it difficult to compare them. However although it is said that one cannot compare apples and oranges, one can compare apples and apples. Although both products might ostensibly be the same, there may nevertheless be significant differences between them. I have emphasised this point because the issue which is at the heart of this case is how does one properly compare certain products which are sold in supermarkets.
This definition and comparison of 'things' by what they have in common but also by what differentiates them is captured by the maxim –' per genus et differentiam' (by family/type and by differences). In other words, the proper approach when trying to compare products is not only to assess what they have in common but also to assess what their differences are. If the products are identical, or almost identical, they are of course comparable. However if the products, although ostensibly similar, have markedly different characteristics then they are not really comparable. To use an example given during the trial, chocolate biscuits and ordinary biscuits are both biscuits. To that extent they are comparable. But a chocolate biscuit is clearly different to an ordinary biscuit. There is a clear qualitative difference between the products. To that extent, they are not comparable. These differences might be significant enough to persuade a consumer to choose biscuit A over biscuit B.
The question then is; how does one assess this difference in quality or nature of a product. The question arises in this case because under EU and National law, comparative advertising (whereby one trader compares his products with those of another trader) is permitted but only if certain conditions are fulfilled. One of these conditions is, for example, that the comparative advertisement must objectively compare the material, relevant, verifiable and representative features of these goods. This requirement encapsulates, in a legal formula, the maxim ' per genus et per differentiam' because it requires the two products to be compared with reference to all their material features, all their relevant features and all their representative and verifiable features. Thus, for example, two goods might both be biscuits, yet within the category of biscuits they have material and relevant differences which means they are not properly comparable.
This issue of how to properly compare products is not mere idle philosophical speculation. In fact, the proper approach as to how one compares products is at the heart of the different methodological approaches adopted by the expert witnesses on behalf of the plaintiffs and the defendant. The key battleground in this case was whether a proper comparison had been made by Dunnes Stores in respect of fifteen specific products where it had compared its products with those of Aldi. The question which then arose was; how does one properly compare such products. The plaintiffs' experts sought to consider all the attributes of both products and to consider not only what they had in common but also any essential differences between them. By applying this approach the plaintiffs' experts assessed whether the products were in fact...
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Aldi Stores Ireland Ltd v Dunnes Stores
...be found in a thorough and comprehensive judgment of the High Court (Cregan J.) delivered on 9 June 2015, which runs to 141 pages (see [2015] IEHC 495). Aldi succeeded in the High Court on almost every aspect of the case. The issue of injunctive relief was dealt with in a further judgment ......
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Aldi Stores (Ireland) Ltd v Dunnes Stores
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