Aldi is famous for its ‘dupes’. Where’s the line between clever lookalike and copyright breach?

Aldi, the Australian discount supermarket chain, has long capitalized on its "dupe" or "lookalike" strategy, offering products that closely resemble popular brand names at a fraction of the cost. However, this approach is not without legal risks, particularly in the context of Australian copyright law. Recently, Aldi lost a bid to overturn a 2024 Federal Court ruling that found three products in its Mamia baby snack range infringed the copyright of rival Bellies brand, owned by Hampden Holdings IP.

This case sheds light on the fine line between inspiration and copyright infringement when it comes to product packaging design. Copyright law protects the expression of an idea, not the idea itself. For instance, the concept of using a cartoon animal on packaging to appeal to parents is protected, but the actual design with a specific color scheme and shape may not be.

The "substantial similarity" test is used to determine if one product's branding has reproduced a significant portion of another's. This test relies on evidence of a causal connection between the products, as well as a degree of objective similarity. In the Aldi case, the court found that the design agency of Aldi had used Hampden's packaging as a benchmark when creating their own.

While the court acknowledged that Aldi had copied the architecture of Hampden's products, it determined that the overall similarity was not enough to constitute copyright infringement. However, the Full Court overturned the original ruling, requiring a side-by-side comparison of all elements in Hampden's packaging and assessing the overall significance of original elements in determining infringement.

In summary, while Aldi's dupe strategy is not inherently unlawful, it can still lead to copyright liability if it deliberately copies distinctive elements that make the original product recognizable.