Last month Mondelēz International filed a lawsuit against Aldi, alleging that the packaging designs for several of its private-label products infringe trademarked visual properties and harm the reputation of several Mondelēz brands. Melanie King, litigator in the Intellectual Property Group at Armstrong Teasdale, outlines the main points of the lawsuit.
In an age of rising inflation and seemingly never-ending supply chain disruptions, consumers are increasingly seeking out store-brand versions of their favourite foods. While many consumers have come to rely on similarities between product packaging to know what brand the private-label good is mimicking, a new lawsuit by Mondelēz International, the company behind snack foods like Oreo and Chips Ahoy!, challenges that very practice.
Through the lawsuit, Mondelēz accuses discount retailer Aldi of trade dress infringement and dilution based on Aldi’s sale of private-label goods that, according to Mondelēz, use confusingly similar packaging to that of brands like Oreo, Ritz, and Nutter Butter.
What is trade dress infringement and dilution?
In essence, trade dress is anything other than a product’s name or logo that indicates to a consumer not only what a product is but who made it. Mondelēz cannot succeed on any of its claims unless it first convinces a jury that its product packaging is protectable trade dress.
For example, a customer in the cookie aisle who sees a blue package featuring white text atop a large, dark-colored sandwich cookie must understand from the package alone that the product inside is not only a chocolate sandwich cookie, but specifically an Oreo. To prove infringement, Mondelēz will then have to demonstrate that Aldi’s packaging is so similar to Mondelēz’s that consumers who buy Aldi’s products are likely to be confused or misled into believing they have purchased the name-brand version.
Mondelēz’s dilution claim, on the other hand, focuses on the distinctiveness of Mondelēz’s trade dress rather than the protection of consumers. Mondelēz will need to prove both that its trade dress is so famous as to essentially be household recognizable throughout the United States, and that consumers are likely to associate Aldi’s packaging with Mondelēz’s, thereby diluting the distinctiveness of Mondelēz’s trade dress.
Aldi has not yet responded to Mondelēz’s claims. Once it does, it will most likely be two years before a jury answers these questions, if the parties do not settle.
This lawsuit tests the bounds of acceptable generic trade dress
This case presents questions of significant concern for any retailer offering private-label products. As Mondelēz’s complaint acknowledges, Aldi is “often referred to as a ‘discount’ supermarket,” and is “well known for its television advertisements featuring the slogan ‘like brands, only cheaper.’” In other words, Aldi customers are typically aware they are not buying name brands - that’s why they’re shopping at Aldi.
While that fact will make it harder for Mondelēz to prove that consumer confusion is likely, it could be enough to show that consumers are likely to associate Aldi’s packaging with Mondelēz’s. If Mondelēz can show that Oreo’s packaging is household famous, that would be enough to succeed on a dilution claim. Successful dilution claims are rare because the bar for famousness is incredibly high, but Oreo may be able to pass that test.
If Mondelēz is successful on its infringement claims, we may see a fundamental change in private-label packaging across the United States, especially at discount retailers like Aldi that typically do not carry name brands. Stores that carry both versions can always simply stock them side-by-side.
For stores like Aldi, however, not being allowed to use the original product’s name or similar product packaging leaves few avenues for it to indicate what brand its product is mimicking. Mondelēz might say that’s just how the cookie crumbles.
Through her work at Armstrong Teasdale, Melanie King focuses on complex, high-stakes trademark, copyright and patent litigation in federal courts across the country. She serves as litigation lead for the firm’s Trademark Trial and Appeal Board (TTAB) practice, overseeing litigation strategy for TTAB proceedings from inception through to trial. Melanie also advises clients on IP best practices under the Lanham Act and the Digital Millennium Copyright Act (DMCA).
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