Battle of the Caterpillars: What Can Copycat Products Teach Us About Trade Marks?

Who gets your vote: #SaveColin or #FreeCuthbert?

The battle between Marks & Spencer’s (M&S) Colin the Caterpillar and Aldi’s Cuthbert the Caterpillar captured the public imagination in 2021. What started as a dispute over two chocolate caterpillar cakes quickly became a lesson in trade marks, passing off and the challenges businesses face when protecting a successful brand.

While Aldi and M&S ultimately reached an agreement, the dispute raises some useful questions for businesses: when does a similar product become an infringement, and how can businesses protect their brands from copycats?

The Colin v Cuthbert Dispute

In April 2021, M&S took legal action against Aldi over Cuthbert the Caterpillar, arguing that Aldi’s product infringed its intellectual property rights.

M&S had been selling Colin the Caterpillar since 1990 and had built significant brand recognition around the character. It had also secured trade mark protection relating to Colin and other aspects of its branding.

Aldi’s Cuthbert was not the first caterpillar cake to appear on supermarket shelves. Tesco, Asda and Sainsbury’s, among others, had their own versions. However, M&S considered Cuthbert sufficiently similar to Colin to justify legal action.

The dispute quickly became a social media sensation, with consumers taking sides and Aldi using the publicity to its advantage.

But what would the legal test actually have been?

Trade Mark Infringement

A registered trade mark gives its owner exclusive rights in relation to the goods and services for which the mark is protected.

Trade mark infringement can arise in a number of circumstances, including where a similar sign is used in relation to identical or similar goods or services and there is a likelihood of confusion among consumers.

There can also be infringement where a mark with a reputation is used without due cause in a way that takes unfair advantage of, or is detrimental to, the distinctive character or reputation of the trade mark.

This means that simply creating a product which looks similar to another product does not automatically amount to trade mark infringement. The precise nature of the relevant trade mark rights and the way in which the allegedly infringing sign is being used are important.

What about passing off?

M&S could also rely on the common law tort of passing off.

Passing off is designed to protect the goodwill and reputation a business has built up in its goods or services. Broadly, a claimant needs to establish three elements:

1. Goodwill or reputation– the business has goodwill or reputation attached to the relevant goods or services;
2. Misrepresentation– the defendant has made a misrepresentation likely to lead, or capable of leading, members of the public to believe that its goods or services are connected with the claimant; and
3. Damage– the misrepresentation has caused, or is likely to cause, damage to the claimant’s goodwill.

Importantly, passing off does not require a business to have a registered trade mark. It can therefore provide an additional layer of protection for businesses that have established a strong reputation in their brand, products or services.

Does a Similar Product automatically Infringe?

No.

The existence of similar products on the market does not automatically mean that a business is free to copy another brand. Equally, a product being deliberately designed to remind consumers of a successful competitor does not necessarily mean that it will amount to trade mark infringement or passing off.

The legal analysis will depend on the particular circumstances, including:

• the scope of the claimant’s registered trade mark rights;
• how similar the relevant signs or products are;
• the goods or services involved;
• the reputation and distinctiveness of the claimant’s brand;
• whether consumers are likely to be confused or believe there is an economic connection;
• whether the use takes unfair advantage of the reputation of the trade mark; and
• whether the claimant can establish the requirements for passing off.

This is why businesses should not assume that a competitor’s product is lawful simply because other similar products already exist on the market.

The importance of brand protection

The Colin and Cuthbert dispute demonstrates the value of building and protecting a distinctive brand.

For businesses, intellectual property protection should ideally be considered before a product or brand becomes successful. Registering appropriate trade marks can provide valuable protection and make it easier to take action if a competitor begins using a similar brand.

Businesses should also monitor the market for potentially infringing products and consider how they will respond when issues arise.

However, legal action is not always the only option. As the Colin and Cuthbert dispute demonstrated, commercial negotiations and the management of public relations can also play an important role in resolving an intellectual property dispute.

What can Businesses Learn from Colin and Cuthbert?

The caterpillar cake dispute may have been light-hearted in the eyes of the public, but it highlights some serious points for businesses.

Know What You Own.
Businesses should understand which elements of their branding and products are protected by registered trade marks, copyright, design rights or other intellectual property rights.

Register your Trade Marks Early.
A strong brand can become one of a business’s most valuable assets. Appropriate trade mark protection can help prevent competitors from taking advantage of the goodwill a business has built.

Monitor Competitors.
Identifying potentially infringing products or branding early can give businesses more options when deciding how to respond.

Consider the Commercial Picture.
An intellectual property dispute does not take place in isolation. Litigation can be costly and time-consuming, while a carefully managed commercial resolution may sometimes provide a better outcome.

Think about Reputation as well as Legal Rights.
The Colin and Cuthbert dispute demonstrated how quickly an intellectual property dispute can become a public relations story. Businesses should consider both their legal position and how their response will be perceived by customers.

Protecting your brand

The Colin and Cuthbert dispute shows that intellectual property disputes can involve much more than determining whether two products look alike. The strength of a business’s existing rights, the reputation of its brand and the circumstances in which a competitor is using similar branding can all be important.