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  • Subject area(s): Marketing
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  • Published on: 14th September 2019
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Good evening viewers, my name is Alyssa Kalamas and welcome back to A Current Affair. Tonight, I'll be bringing to you a story shows the declining presence of originality in the retail world through the existence of copycat brands and their unfair marketing techniques. So, the biggest question is, how do they get away with it? How is it that major retail stores such as Aldi, can intentionally produce such similar products to respected upmarket brands? such as Moroccan Oil Israel LTD, Coco pops and many more. Whilst speaking to well established Lawyer, Lesly Felton, he expressed how simple it is to create similar brands at cheaper prices whilst being in accordance with the current Australian legislation. LESLY FELTON:” the current legislation protecting intellectual property for copycat brands is not effective and does not encourages heathy competition.” Therefore, Major brands are supposedly suffering from small copycat brands that are somewhat “stealing” their ideas, whilst still abiding by the law.  

Section 120 of the Trademarks Act 1995 (Cth) states that a person infringes the current trademarks act when they use a trade mark that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered (gov, 1995). Although when taking cases to court the majority of copycat brands don't fall under this legislation there are others protecting the big brands too. such as the Australian Consumer Law, section 18 of the ACL prohibits a person, in trade or commerce, from engaging in misleading or deceptive conduct and section 29 of the ACL prohibits, in connection with the supply or possible supply or promotion of goods or services that are false or misleading representations that goods are new (gov, 1995). And finally, the competition and consumer act 2010 which is used to enhance the welfare of Australians through the promotion of competition and fair trading and provision for consumer protection  (gov, 2010). But still the big question lies, how are they getting away with it?

 “Like brands, only cheaper” is both an advertising slogan used by the German supermarket giant, Aldi, and its business model. This investigation brings these business practices into sharp focus, as its genesis lies in concerns that some of Aldi's products are not just “like brands” but deceptively like a particular brand. When specifically looking at the injustice within our retail world, a recent lawsuit carried out between Moroccan oil Israel ltd and Aldi foods pty ltd clearly depicts the unjust outcomes of stealing intellectual property. Moroccan oil Israel ltd is a natural hair product that is well known for its organic ingredients and proven hair benefits. Given its well-known value and popularity, in 2011 an Aldi buying assistant Meagan Spinks identified Moroccan Oil Israel LTD (MIL) as an on-trend hair product and realised how a similar product with Aldi branding would attract buyers (berger & chelebain, 2017). Then came about “Moroccan Argan Oil”, a type of shampoo by the well-known Protane Aldi Brand.

 MIL concluded that this intellectual property theft left loyal MIL shoppers confused and often under the assumption that both products were from the same brand. This unjust copycat activity led to the famous case whereby MIL took Aldi to court in 2017, where the court came to find that ALDI was in fact not breaching the trademarks act 1995 part 120 but instead breaching sections 18 and 29 (1, a) which both relate to misleading and deceptive conduct) of the Australian consumer law. Her Honour then ordered Aldi to discontinue the production of the brand with the use of the word ‘natural' and ordered Aldi to pay mils costs. Although later getting appealed earlier this year, the injustice still stands. The current ACL legislation and trademarks acts allows for theft of intellectual property with minimal sentencing. How is this fair to those that produced the original idea?

These copycat brands are simply getting away with blatantly copying the big brands. in interview with Ms Spinks she stated that “once “a new and interesting trend” is identified, she seeks out what “other competitor products” are available on the market that are part of the trend. She said that in her experience Aldi's practice was to introduce its own “version” of a product in “an on-trend product category”. In developing “Aldi versions” of these products, the packaging used by competitors is considered in order to ensure that the Aldi “house brand” packaging was “consistent with” the trend. As part of this process, a “benchmark” product is selected from a range of “on-trend products”.” Copycat brands are purposely branding their products to look like the original, so it confuses the consumer. When speaking to four buyers of MIL that shop at Aldi here's what they had to say.

Comment #1: “I have definitely bought this at Aldi.”

Comment #2: “What I bought from Aldi has the same colour blue packaging and dark brown bottle.”

Comment #3: “They look the same.”

Comment #4: “I didn't know that the MOROCCANOIL Product was available in Aldi until I saw it when I was shopping there recently.” (browne, 2018)

These buyers have no clue that Aldi has produced a deceptively similar product as the bottles of the said product are so similar. As you can see these products look nearly the same. MIL is not the only product that Aldi had “ripped off” there are others such as the well-known coco pops brand, Aldi's rendition of it named choco rice. It is especially easy for the customers to get confused as Aldi now sells some name brand products such as lynx and Rexona.

Now back to Lesly where he has some recommendations to help minimise the rate of brand stealing. LESLY FELTON: “although the current laws do their job at protecting most brands we still need a way to protect the ones that don't fit inside of those brackets. There needs to be a new system set into place, so it protects all brands from getting their precious intellectual property stolen. The current trademarks act 1995 part 120 where the words “deceptively similar” and “substantially identical” are used multiple times are not defined, creating confusion in the courts and leaving it up to the judge's interpretation, the judges have too much digression and this is why all these cases are going unnoticed or get appealed. Creating a definition for everyone to follow that includes specific criteria for brands to follow that would allow for brands to be similar within the criteria for healthy competition and for the consumers that prefer home brands. introducing an ombudsman would also significantly help brands who don't want immediate court action, an ombudsmen duty are to investigate consumers or brands complaints against a company or organization, especially a public authority, this is a much cheaper option than going straight to court (gov, 2018).”

In conclusion the current legislation protecting intellectual property is in fact effective but there should be alternative paths for brands to take other than immediate court action as mentioned by well-known lawyer Lesly Felton. Thank you and good night, tune in tomorrow to hear a chilling story about drunk driving.  

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