Lidl may seek bite of Tesco's Clubcard profits after winning trademark lawsuit
By Sam Tobin
LONDON (Reuters) - German-owned discount supermarket Lidl may seek a share of any profit made by rival Tesco from its Clubcard discount scheme as a result of copying Lidl's logo, London's High Court heard on Monday.
Lidl sued Britain's biggest retailer Tesco in 2020 shortly after Tesco adopted a yellow circle against a blue background to promote its "Clubcard Prices" discount scheme.
The two retailers traded allegations of copying brands and deceiving customers at a trial in February.
Lidl won the case last month, with a judge ruling Tesco had "taken unfair advantage of the distinctive reputation" for low prices held by Lidl's trademarks.
Tesco was refused permission to bring an appeal against that decision at a brief hearing on Monday, but it can apply directly to the Court of Appeal.
The retailer's lawyers said it could be impossible to establish how much profit may be linked to the use of Lidl's logo for the Clubcard scheme, but Lidl's lawyer said it could be huge.
"Tesco is responsible for around a quarter of the UK's entire supermarket share and Lidl for approximately 7%," lawyer Benet Brandreth said in court filings.
"Over three years that amounts to many millions of customers and billions of pounds of turnover and profit. If even a fractional percentage of that trade is attributable to the infringement, the resulting sums are huge."
Lidl is seeking financial disclosure from Tesco – including revenue and operating profit for Tesco as a whole and from Clubcard holders – to calculate what profit Tesco may have made from infringing its trademark.
Both Lidl and Tesco agreed on Monday that they will try to resolve the issue of disclosure, after which Lidl must decide whether to seek damages or an account of profits made by Tesco.
Lidl is also asking for an injunction preventing Tesco from infringing its trademark. Both sides agree any steps to remove Clubcard Prices logos from Tesco stores should be put on hold pending any appeal.
Tesco reported a 6.3% fall in profits for the year 2022/23 and said inflation meant it would be difficult to grow its profits this year.
(Reporting by Sam Tobin; editing by Barbara Lewis)