High Court: Lidl injunction rejected over Irish Farmers’ Association ‘fake farms’ claim



Killian Flood BL
Killian Flood BL

The High Court has refused an application by Lidl Ireland GMBH for an injunction prohibiting the publication of two advertisements by the Irish Farmers’ Association.

Lidl claimed that the advertisements contained allegations that their own-brand milk was not Irish and that they had been misleading customers as to the provenance of their dairy products.

Delivering judgment in the case, Mr Justice Senan Allen held that the defendants had a bona fide defence to the proceedings. The court held that the IFA could point to evidence that the Lidl milk was not Irish and that the labelling was designed to mislead customers about the source of the products. Accordingly, the court held that the factual disputes should be left to a jury to conclusively determine.

Background

Lidl had issued defamation proceedings against the IFA, its president and deputy president following the publication of two advertisements. The ads were published in prominent newspapers in March 2021.

The advertisements were part of a campaign by the IFA against the use of fictitious producers of milk by Lidl for its own brand milk. The IFA claimed that Lidl was selling milk that was labelled to be from a local source in the Republic of Ireland. It was claimed that the own-brand milks from Lidl were attributed to “fake or phantom businesses” and these brands were used by Lidl to drive down the price of milk.

As such, the advertisements included phrases such as “EXPOSED”, “Lidl and Aldi CLAIM to support Irish dairy farmers” and “To be sure your milk is from the Republic of Ireland, look for the NDC logo.”

Lidl claimed that the advertisements were highly defamatory because they alleged that Lidl was misleading or tricking its customers about the origins of their milk. As such, Lidl brought an application under section 33 of the Defamation Act 2009 seeking an injunction to prohibit the publication of the advertisements.

It was argued by Lidl that the words used in the ads had clearly defamatory meaning and that there was no defence to the proceedings.

The defendants raised a host of submissions in opposition to the motion. These included that the information in the advertisements was the truth and that the true meaning of the ads was that there were grounds to believe the plaintiff’s branding strategy was misleading. Further, the defendants produced an expert report which was commissioned to analyse how Lidl’s branding strategy was driving down milk prices.

High Court

Giving judgment in the case, Mr Justice Allen first outlined the proper legal test under section 33 of the 2009 Act. The court noted that a court must be satisfied 1) that the words clearly bore the pleaded defamatory meanings and 2) that the defendants had no defendants had no defence that was reasonably likely to succeed.

Turning to the first limb of the test, the court stated that the evidence and submissions for Lidl focused on the country of origin of its milk. In particular, the plaintiff said that the advertisements meant that the Lidl own-brand of milk was not Irish milk. Where the plaintiff’s brands were pictured and labelled as “misleading” in the ads, the court said that this was not sufficient to establish that the defendants were saying the milk was not Irish.

Further, for the statement “To be sure your milk is from the Republic of Ireland, look for the NDC logo”, the court was not satisfied that this clearly meant the plaintiff’s milk was not Irish. The NDC logo could be applied to milk that was either produced or merely packaged in Ireland, so it did tell the consumer the origin of the milk, the court said.

The court further held that the meaning of words was “quintessentially a matter for the jury”. The court held that the defendants had a bona fide case that the advertisements were not misleading as to country of origin. If the plaintiff’s branding strategy was directed towards the price paid for milk, then the first advertisement was “at least capable of being understood” as a complaint by farmers about the prices paid.

Assessing the second advertisement, the court was not convinced that it could be misleading as to country of origin. The court held that the language used in the advertisement showed that the defendants were saying the products were Irish.

The court then considered whether the defendants had no defence to the proceedings. The court noted that despite the defendants raising a number of points in their defence, it was for the plaintiff to prove that there was no defence. However, the court cited Reynolds v. Malocco [1999] 2 I.R. 203 and said that it was appropriate had to consider the evidence of the defendants in order to assess their prospect of success.

The court then considered the expert report adduced by the defendants on the effect of the branding strategy on milk prices. As such, it was held that the defendants had successfully pointed to evidence of their belief that the Lidl brand was being used to sell milk more cheaply.

The court did not attach any significant weight to the survey evidence produced by the defendants regarding customers’ understanding of the sources of the milk. The questions did not seem sufficiently open to get a reliable result and the court was unsure if the correct demographics were used. However, it was accepted in principle that survey evidence could be used to show customer confusion (Galway Free Range Eggs Limited v. O’Brien [2019] IECA 8).

As a result of these findings, the court held that Lidl had failed to meet the legal test outlined in section 33 of the Act. Nevertheless, the court felt it was important to comment on whether damages were an appropriate remedy. The court noted that damages were the default remedy for defamation but that injunctive relief had been placed on a statutory footing by virtue of the 2009 Act. As such, the court said: “I wonder whether, nowadays, it would be just that a plaintiff might have to bear a clear and plainly unjustifiable attack on his character simply because the defendant is a mark.”

Conclusion

The court rejected the application for an injunction on the basis that the plaintiff failed to meet the high bar under section 33 of the 2009 Act. The court made no definitive decision on the overall likelihood of success for either party. The court was not satisfied that the advertisements “clearly and only” meant that the milk was not Irish and that Lidl was misleading its customers. The plaintiff had not established that there was no defence to the case.

© Irish Legal News Ltd 2021



Other judgments by Mr Justice Senan Allen

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