Supermarket giant Aldi has been found liable for copyright infringement over packaging for children’s snack foods that used a rival brand as a “benchmark” for its design.
Aldi – which once used the slogan “like brands, only cheaper” – launched a rebrand of a range of children’s snack food products including fruit-flavoured corn puffs under the Mamia brand in August 2021.
The packaging featured a cartoon owl smiling on the packaging above images of the food. In October, Hampden Holdings, the owner of a rival brand, Baby Bellies, sent the supermarket a letter alleging copyright infringement, ultimately leading to Hampden Holdings taking Aldi to court in relation to 11 product designs.
Federal court justice Mark Moshinsky on Tuesday found Aldi was liable for copyright infringement for its puff products – three of 11 products Hampden had sought orders against – describing the conduct as “flagrant”.
“Aldi sought to use for its own commercial advantage the designs that had been developed by a trade rival,” he said. “Although Aldi may have intended, if possible, to avoid infringement and legal liability, it took the risk that its use of the Bellies designs would exceed what the law allows. I consider Aldi’s conduct to be flagrant.”
Evidence presented to court showed emails between Aldi and the design firm Aldi had recruited in 2018 to redesign the packaging for its Mamia products, and the buying director for the product had set the Bellies redesigned packaging as the “benchmark” for the design as the market leader.
“Please follow the architecture of Baby Bellies and use photographic imagery,” the buying director wrote in an email to the design firm in 2019. In 2021, after more iterations were made, an email states that the design is “too close to our benchmark” and further changes were made.
“Aldi have now had legal come back to them and state this design is too close to the benchmark – no shit!” an email from the design firm stated.
“Now that the owl doesn’t have text in his tummy I think this should move it far enough away from the benchmark,” a later email stated.
The puff products went on sale in August 2021, leading to the copyright infringement letter in October that year.
In December 2021, Aldi made changes to the branding, including changing the owl to a monkey, and altering the font. Further changes were made in August 2022 in an attempt to resolve the issue, including amending the cartoon character to have less of a belly and a change to how the food is presented on the package.
The company no longer sells the products using that packaging, which now uses a cartoon of a baby bird.
Aldi had argued that Hampden Holdings was attempting to argue copyright protection for a “look and feel” rather than a form of expression. This was not accepted by Moshinsky.
“It is true that the identification of those elements involves some degree of abstraction, but the elements are not identified at so high a level of abstraction as to venture into the protection of ideas rather than their expression,” he said.
The supermarket was found not to be liable for branding for the other products, including rice cakes and fruit bars.
Moshinsky found Aldi liable for damages and additional damages considering the company continued to sell the products after initially receiving letters from the rival brand. A further hearing to determine the damages will be set at a later date.
Aldi and Hampden Holdings have been approached for comment.
Aldi has faced legal action over a number of years over its product design. Copyright law expert Fiona Phillips told Guardian Australia that it had “long been controversial” but the facts in this case were unlikely to set a precedent.
“The decision was highly fact-dependent. His honour found infringement in relation to the ‘puff’ products but not in relation to Aldi’s [other products].”
“It was central to the case that there was evidence that Aldi asked their designers to use the Bellies products as a ‘benchmark’.”
In 2018, Aldi won a full federal court appeal against a misleading and deceptive conduct ruling over hair products brought against the company by Moroccanoil Israel.
