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IP Whiteboard

Look-Alike Get Up – Can IP Whiteboard develop an objective method to test that most subjective of assessments?

6 June 2013

Many of us are attracted to IP law because we love retail therapy and brands. The party has to end somewhere though, and often it’s the court room. The careful legal advice, opinions from Senior Counsel, expert evidence and surveys assume less importance when a judge – as a matter of impression – makes his or her own assessment. This is where the concept “reasonable minds can differ” is brought to life.

At IP Whiteboard we’ve developed a scoring system to help assess look-alike packaging for legal risk…whichever side you’re on. CAVEAT: We don’t promise this scoring system is perfect. Any improvements we can make? Let us know!

In this blog post we’ll explain the scoring system, and give you some examples to self-assess.

We have used Aldi products as our ‘base case’. Aldi’s award-winning “Like brands. Only cheaper” campaign illustrates its famous product-line strategy, which it has successfully defended in an Australian Court: Aldi v Frito-Lay (2001) 54 IPR 344 (the “Cheezy Twists case”).

Legal issues in Australia relevant to look-alike products:

1. Is there a copyright infringement?

The question is usually whether aspects of the offending packaging infringe a particular artistic or literary work. The test – in general terms – is whether the alleged infringing work is ‘objectively similar’, involves copying, and whether a substantial part of the expression of the original work (both quantitatively and qualitatively) has been reproduced.

2. Is there misleading or deceptive conduct under the Australian Consumer Law (“ACL”)?

Here, the question is whether consumers are likely to be misled or deceived into thinking that the look-alike product is the popular branded product, or associated with it in some way. One needs to assess this by reference to the reactions of the “ordinary or reasonable consumer”. Conduct that is merely confusing or creates uncertainty in the minds of consumers will not necessarily amount to misleading or deceptive conduct.

The characteristics of the ordinary or reasonable consumer will be significant. For example, a person who shops at Aldi irregularly (or a first time Aldi shopper) might be less familiar with Aldi’s “Like brands. Only cheaper” strategy, and might be more likely to be misled or deceived than, say, an experienced Aldi shopper who heads to Aldi specifically to purchase its home brand products.

3. How about common law passing off?

One must assess the established brand’s reputation in the marketplace. The look-alike packaging must misrepresent to consumers that a trade connection exists between the two products. Unlike an action under the ACL, damage (for example, damage to reputation) must also be shown.

Passing off also requires the incumbent brand to show damage, or likelihood of damage, for example to its goodwill or reputation.

Note: In our scoring system we have not attempted to guesstimate the extent of any damage involved.

4. Is a registered trade mark infringed?

A registered trade mark will be infringed where a party uses, as a trade mark, a sign that is substantially identical or deceptively similar to a registered trade mark.

The first question is whether the established brand owner has registered an element (or elements) of its packaging as a trade mark (which can include colours and shapes, in addition to words and logos), and whether the product itself is covered by the trade mark registration.

Secondly, one must consider whether the look-alike product uses those registered elements “as a badge of origin” namely, as a ‘brand’ rather than as a descriptive element [This one can be hard to work out].

Finally, to determine whether the sign on the look-alike product is:

(a) substantially identical to the registered mark, a side by side comparison is undertaken; or

(b) deceptively similar to the registered mark, a consumer’s “imperfect recollection” is the basis for assessing the likelihood of confusion about source.

5. Is there an agreement in place?

If an agreement exists that expressly permits another trader to use elements of their brand or packaging, packaging that seems close to the line may in fact be authorised.

 

Scoring system

We’ve come up with a scoring system that takes into account the core features of copyright, consumer protection, passing off and trade mark law. Once you’ve applied the system, rank the products using our highly scientific (NOT!) “emoticon meter”: the closer the ‘like brand’ product might get to hot water, the more confused the smiley face appears:

= This one’s been debated long and hard.

= There are some interesting discussions to be had. A person could be persuaded either way.

= Good points for the devil’s advocate, but there wasn’t too much in it.

= This probably isn’t causing anyone to lose sleep at night.

 

Here it is. Click here for the IP Whiteboard Look-Alike Get Up Score Card

 

Product Comparison

A few things to consider in your assessment:

  1. Aldi does sell some well-established brand products (sometimes next to Aldi products, sometimes in a separate section). If directly comparable products were sold in the same aisle, do you think this might impact consumer impressions?
  2. Consider how consumers go about the process of selection (price sensitive? impulse purchase?) and their likely knowledge or otherwise of Aldi’s “Like brands. Only cheaper” approach.
  3. Many product features are assessed on the basis of a consumer’s first impression. In reality, if a complaint makes its way to Court, a judge will spend countless hours focussing intently on the packaging. What
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    effect do you think this might have on the final result?

  4. Note: our photographs display the products “side by side”. Remember: this might not be the applicable legal test. Consider how you might present the merchandise in Court, depending on which side you’re on.
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