The German company TofuTown produces and distributes vegetarian and vegan foods. Its purely plant-based products are marketed with the designations "‘Soyatoo tofu butter", "plant cheese", "veggie cheese", "cream" and similar terms.
The Verband Sozialer Wettbewerb, a German association responsible for combatting unfair competition, took the view that the promotion of such products under names associated with the dairy industry violated the EU legislation on designations for milk and milk products, thereby deceiving consumers and distorting competition. Consequently, the association filed suit against TofuTown to prohibit it from using dairy names with its plant-based products.
TofuTown argued that its advertising does not violate the legislation in question. It relied mainly on two arguments. First, given the proliferation of substitutes for dairy products made from soy or tofu, for example, consumers' understanding of the words "milk, "cream", "butter", "cheese" and "yoghurt" has changed considerably. Second, these designations are not used alone but rather always in association with words referring to the plant origin of the products concerned, e.g. "tofu butter" or "rice spray cream".
The Court noted that, in principle, for marketing and advertising purposes, the relevant legislation provides that the word "milk" can be used only to designate milk of animal origin. In addition, save a number of express exceptions, the legislation reserves designations such as "cream", "chantilly", "butter", "cheese" and "yoghurt" solely to products derived from milk.
The Court concluded that these designations cannot be used to designate purely plant-based products, unless they are included on the list of exceptions, which is not the case for soy or tofu.
The Court rejected the second argument of Tofu Town, ruling that the addition of descriptive or clarifying statements indicating the plant origin of the product is irrelevant for purposes of the prohibition.