German discount chain Lidl says a trademark, and copyright, has been infringed, while Tesco has made a counterclaim.
Lidl uses a yellow circle in its main logo, and Tesco uses one to highlight offers available to members of its Clubcard scheme.
A judge began overseeing a trial at the High Court in London on Tuesday.
Mrs Justice Joanna Smith was shown images of logos, including a yellow circle, surrounded by a red ring, containing the word “Lidl”; a yellow circle, surrounded by a red ring, with no words; and a yellow circle without a red surround and the words “Clubcard Prices” in the middle.
Barrister Benet Brandreth KC, who is leading Lidl’s legal team, said the “protection available to Lidl’s core brand” is “at the heart of this claim”.
Hugo Cuddigan KC, who is leading Tesco’s legal team, said that to establish infringement Lidl would need to satisfy the judge that “creating a yellow circle involves sufficient artistic skill and labour to comprise the author’s own intellectual creation”.
He said it does not.
Mrs Justice Smith is due to hear evidence from senior supermarket staff and from consumers.
Mr Brandreth told the judge in a written case outline: “At the heart of this claim is the protection available to Lidl’s core brand.
“Lidl have registered trademarks for the mark with text and for the wordless marks.
“As is apparent, the wordless mark is the device across which the name Lidl appears.
“Lidl say that device is distinctive of its services and goods quite apart from the name Lidl.”
He added: “Lidl have, through the vast use made of them, generated a huge reputation and goodwill in both the mark with text and the wordless mark.
“That reputation and goodwill is specifically that Lidl are a supermarket that offers value, that is to say quality goods at low prices.
“The complaint is about the uses by Tesco of an identifier for its Clubcard Prices promotion, which commenced in September 2020.”
Mr Cuddigan told the judge in a written case outline: “The heart of the dispute concerns trademark infringement, and the key mark relied on by Lidl is the registered trademark for Lidl’s well-known logo, which Lidl calls the ‘mark with text’.”
He said Lidl had “also procured” the registration of the background to that logo – the “wordless mark”.
“Tesco says that the wordless mark is invalid on the basis that it has never been used, it lacks distinctiveness, and each application for registered wordless marks was made in bad faith,” he said.
“It is common ground that Lidl has only used the wordless mark, if at all, by using it within the mark with text.
“Lidl’s infringement claim itself relates to Tesco’s use of a suite of icons used to identify its Clubcard Prices promotion.”
He said the red ring did not appear in the Clubcard signs and added: “Accordingly, at its high point, the case on infringement would be based exclusively on the reproduction of a yellow circle.
“Lidl would need to satisfy the court that creating a yellow circle involves sufficient artistic skill and labour to comprise the author’s own intellectual creation.
“It does not.”
The hearing is due to end next week.