We've all witnessed this before - when a popular product brand becomes successful, a larger or competing company often produces a similar product at a much lower price.

It's not necessarily a bad thing – after all, why pay more for something you can get for less? But in some instances, this can lead to ethics violations and copyright infringement.

One example is the recent copyright case against ALDI — a major retailer known for its affordable prices and for stocking products that are similar to well-known brands.

Recently, the German retailer was accused of copying Little Bellies, an Australian children's snack food brand, and is now facing a lawsuit.

The case, which is sure to test copyright laws in Australia, was brought to the courts by Little Bellies' owner Hampden Holdings.

According to Hampden Holdings, ALDI allegedly plagiarised Baby Bellies Organic Puffs to create Mamia Organic Baby Puffs. Credit: Facebook/Little Bellies.

Hampden Holdings, the owner of Little Bellies, alleges that the German retailer has copied their fruit and vegetable puffed corn snacks — namely Organic Blueberry Puffs, Organic Apple & Cinnamon Puffs, and Organic Carrot Puffs — and is selling them for a much lower price.

The German retail giant has a track record of lawsuits for copyright infringement, all of which have gone the retailer’s way.

In 2001, US snack brand Frito Lay sued ALDI for a similar case. And more recently, in 2015, Israeli beauty company Moroccanoil also sued, yet both of these cases against the German retailer failed.

The Australian Financial Review has reported that Hampden Holdings licences the brands to Every Bite Counts, the company currently leading the lawsuit against ALDI.

Lance Scott, a principal at Gestalt Law and the attorney for Every Bite Counts, said: ‘As a copyright case against ALDI, the case is novel in Australia. The critical issue is copying. There is no comparison of trademarks.’

Mr Scott added that his client Every Bite Counts wants to safeguard its ‘valuable intellectual property’, which they have invested in heavily.

IP legal expert Katrina Rathie remarked that the lawsuit appears to be more about getting ALDI to change its packaging and gain a settlement.

She explained: 'The test for copyright in Australia is a qualitative test, not quantitative.'

'Has ALDI reproduced a substantial part of the artwork, the essential creative elements and infringed the artistic work? You can't look at colour for copyright.'

Furthermore, the statement of claim alleges that ALDI was aware or should have been aware that the owner of the copyright for Every Bite Counts' Baby Bellies did not licence the reproduction of any packaging designs.

‘The respondent did not obtain (or seek) a licence to reproduce the Blueberry Puffs Work, the Apple and Cinnamon Puffs Work, or the Carrot Puffs Work (or a substantial part thereof) for use on the packaging of the respondent's Blueberry Puffs Product,’ it read.

While larger retailers have the financial resources to pursue legal action against retail chains such as ALDI, small business owners who believe their intellectual property has been infringed upon are often left with limited options.

Small businesses invest significant time and resources into developing unique products and brands, but when larger companies replicate their ideas, it can lead to devastating consequences.

Not only does it hurt the smaller company's unique selling position, but it also undermines their creativity and hard work.

Furthermore, the cost of pursuing legal action can be prohibitive for small businesses, leaving them with few options for recourse.

This puts them at a significant disadvantage compared to larger corporations that have more resources to defend their intellectual property.

Such has been the case for a Byron Bay resident who accused ALDI of imitating her picnic rug design.

Key Takeaways

• ALDI is facing a lawsuit from the Australian children’s snack food brand Little Bellies, accusing the retailer of plagiarism.
• ALDI has a track record for copyright infringement lawsuits, which have gone the retailer’s way.
• The case is likely to challenge Australia's copyright laws, as copyright infringement can be hard to prove under a ‘qualitative’ test.
• Small businesses often have limited options for recourse if their intellectual property is infringed upon, as the cost of pursuing legal action can be prohibitive for them.

Meanwhile, ALDI admitted to creating the packaging for their products without a licence and not seeking one, but they denied committing copyright infringement. Additionally, ALDI has filed a cross-claim, stating that they are ‘a person aggrieved within the meaning of... the Copyright Act’.

ALDI refused to give further comments on the matter on the grounds that it is still an ongoing legal case.

Members, are you surprised by this news story? Is ALDI going too far when it comes to cheaper alternatives of well-known brands? Do you think they should be supporting local products instead? Share your thoughts in the comments below.

 

[Cool Lynda]

What a bully boy Aldi has become, to replicate the packaging of an Aussie product, then pass it off as its own.
I hope the owner of Baby Bellies win this trademark case, which will send a message to Aldi to stop ripping off our Aussie brands.

Aldi is well known for copying the packaging of Aussie products, which is how they make their money.
Don't come up with your own products or designs ......... just rip off others.

I prefer to shop at Coles and Woolworths and keep my money in Australia.

The packaging is very different.

 

[Rob44]

Interesting that a bloke called Mr Virgin was running a garage /mechanic's place somewhere up in Queensland or the NT called Virgin's Garage and got sued by Virgin airlines for breach of copyright over his name. Virgin airlines won the case even though that was the bloke's name and the garage had carried that name for a very long time. That was a good number of years ago.

Then there was a store in Tasmania using the name Targett and along came the Target store chain and sued for breach of copyright and won. That too was a long time ago.

Which simply goes to prove that if a company is rich enough to employ lawyers for long enough, the small guy/business loses. That's not competition; that's bully-boy tactics. And whenever the small guy loses, we lose.

 

[Noraya]

Seems like Aldi is on the consumer's side! Especially for people with low income (many pensioners!) getting the same good quality at a cheaper price and still buying Australian (Aldi sells as many Australian made products if not more than Coles and Woolworth), supporting Australians who work at Aldi's ... it s always been known that Aldi sells the same products under their own brandname. You look at the packaging (which is a giveaway) and you know what s inside... They can sell cheaper because of their business model: "one size fits all". You get family sized cans etc, not tiny/small/medium/large and family or bulk sized of the same product. The same products all the time, others only for a week that is themed "American/German/I dian etc". Means smaller shops, less waste of products past use by date, no self service = less stealing = less loss of money. You always had to pay for your bags and had to put a coin in the trolley. ALL THOSE LITTLE THINGS ALLOW aldi to sell the same products at a lower price, not "stealing a copyright from a poor little Australian". It s a competitive market, and Aldi (the original founders and owners) have come up with a great idea that s still working in favour of many.

 

[Rob44]

If I were good enough to copy a painting by Van Gogh as well as copy his signature and sell it (even very cheaply for $100, without stating that it was a copy, but not claiming it as a Van Gogh, then I would be guilty of copyright.

Copyright law is copyright law.