Inner House extends interdict banning sale of trade mark infringing Lidl gin to UK-wide order

W Grant and Sons Ltd, the owners of the Hendrick’s mark, originally obtained interim interdict against Lidl Stiftung & Co KG and its UK equivalents preventing the sale of its ‘Hampstead Gin’ product in Scotland. Lidl raised a reclaiming motion challenging the interdict, with W Grant bringing a cross-appeal against the scope of the interdict.

The appeal was heard by the Lord President, Lord Carloway, sitting with Lord Woolman and Lord Pentland. Dean of Faculty, Roddy Dunlop QC, and Usman Tariq, advocate, appeared for the pursuers while Lord Keen of Elie QC appeared for the defenders and reclaimers.

Unable to conclude

The alleged infringement came about when Lidl changed the design of their Hampstead Gin bottle in January 2021 to a Victorian-style bottle with a diamond label, characteristics that also apply to bottles of Hendrick’s, as well as changing the alcohol by volume to match that of Hendrick’s Gin. At a hearing before an IP judge, it was determined that there was a case for the proposition that Lidl had infringed W Grant’s trade mark and that there was a prima facie case based on section 10(3) of the Trade Marks Act 1994.

In considering the scope of an interim interdict preventing the sale of Hampstead Gin in the infringing get up, the IP judge felt unable to conclude that he could make an order with a territorial scope beyond Scotland, having regard to European case law on the matter including UVG Ambulances v Auto Conversions (2000) and Speechworks v Speechworks International (2000).

Lidl raised a reclaiming motion seeking recall of the interim interdict, on the basis that the IP judge had made a fundamental error in considering that the Hendrick’s mark was not a colour mark, which W Grant later acknowledged it was. A new trade mark introduced by W Grant had not been disclosed to the IP judge, and no unfair advantage had been demonstrated by W Grant.

In the counterclaim, it was submitted for W Grant that the principal argument concerning colour had not been advanced before the IP judge, and that in any event his judgment applied mutatis mutandis to the new mark. In respect of the scope of the order, it was submitted that the 1994 Act was a UK-wide statute, and it would be perverse if the court could not grant a UK-wide interdict for a UK trade mark.

Extensive use of a colour

Delivering the opinion of the court, Lord Carloway began: “There was sufficient material upon which to conclude that there was a prima facie case of infringement. The Hendrick’s Trade Mark depicts a bottle of a particular shape and bearing a coloured label. It does not show a white bottle, nor does it expressly limit itself to a clear bottle. Grants have for some time used as part of their get-up the dark/brown, opaque, apothecary-style bottle upon which the coloured label is affixed.”

He continued: “Where there is no colour specified in the trade mark, extensive use of a particular colour can result in that colour becoming associated in the mind of a significant portion of the public with the trade mark with the consequence that the defenders’ use of the same colour may be seen as taking unfair advantage of that mark. On this basis, the IP judge was entitled to hold that a prima facie case of infringement had been made out.”

Addressing the arguments on the scope of the order, he said: “Grants had a choice of proceeding in either jurisdiction. They elected to sue in Scotland, as they are entitled to do. It would be surprising if it were otherwise given that the alleged infringement is being committed partly in Scotland and Hendrick’s is produced in Scotland. There is no need, where there is jurisdiction in both countries, to raise separate actions in each one.”

He concluded: “That would be an inefficient use of judicial and court time. No issue of comity arises. There are no parallel proceedings in England and Wales. Had there been such proceedings already in existence, the Scottish courts would possibly have awaited the outcome in England and Wales and vice versa. In these circumstances, and in others where it would be more convenient for the litigation to be dealt with by the courts in England and Wales, the defenders could plead forum non conveniens and the court would consider that issue by carrying out the customary balancing exercise.”

For these reasons, the court refused the appeal and allowed the cross-appeal, recalling the part of the IP judge’s interlocutor restricting the scope of the interim interdict to Scotland.