Cosmetics giant loses the latest round in its fight to stop a Dubai firm selling 'smell-alike' products.
French cosmetics giant L'Oreal lost the latest round of its legal fight to stop a company from selling "smell-alike" copies of its perfumes on Wednesday.
Three judges at London's Court of Appeal said consumers were unlikely to confuse genuine L'Oreal products with cheaper imitations, even if they smell similar.
"The public are not stupid," the judges said in ruling. "It is not suggested that anyone ever thinks a 'replica' product of the kind with which we are concerned is the original.
"Nor is it suggested that anyone thinks a replica is anything other than a cheap imitation of the original or is likely to be of the same quality as the original, even though it may smell somewhat the same."
The cheaper fragrances are marketed with slogans such as "Only your wallet smells the difference" and "The only difference is the price".
L'Oreal, the world's largest cosmetics group, took its case to the appeal court after it lost a High Court challenge last year. It wants to stop Dubai-based cosmetics firm Scion International from marketing Scion's Creation Lamis range.
Scion's products such as La Valeur, Pink Wonder and Nice Flower are sold in discount stores and on market stalls for under 5 pounds ($10), the court heard. They are said to smell like L'Oreal products Tresor, Miracle and Noa.
The judges dismissed L'Oreal's appeal, ruling that the products do not compete with each other, are priced differently and are aimed at separate markets.
L'Oreal is to take the case to the European courts, where it will argue that Creation Lamis has broken trademark laws.
The Paris-based company complains that Creation Lamis uses L'Oreal trademarks on comparison lists to show customers which brand name perfume their cheaper fragrance smells like.