Family-run Glebe Farm Foods Limited (Glebe Farms) has very recently successfully defended allegations of trade mark infringement and passing off from oat milk giants, Oatly, in the Intellectual Property and Enterprise Court.

Judgment in this case was handed down on 5 August 2021 and was reported widely in the media. The action was brought by Oatly for alleged infringement of five of its registered trade marks (the ‘Oaty Trade Marks’) under S10(2) and 10(3) of the Trade Marks Act 1994 for Glebe Farm use of the mark ‘PureOaty’ on its oat-based drinks. Oatly also alleged passing off against Glebe Farm.

Trade mark infringement under S10(2)

In order for Oatly to prove trade mark infringement under this provision it needed to show that:

  1. Glebe Farm had used PureOaty within the UK;
  2. Such use was in the course of trade without the consent of Oatly;
  3. PureOaty was a mark which is identical with or similar to the Oatly trade marks;
  4. PureOaty must have been used in relation to goods and services which were identical with or similar to those for which the Oatly trade marks are registered; and
  5. as a result of Glebe Farm use of the PureOaty sign, there is a likelihood that the average consumer would confuse PureOaty products as being associated with, or deriving from, Oatly itself.

The comparison of the Oatly Trade Marks and the PureOaty mark must be assessed globally taking into account all relevant factors (those include visual, aural and conceptual comparison of the mark against the trade mark as registered) and judged through the eyes of the average consumer of the goods in question.

Given the number of Oatly Trade Marks involved, there were many comparisons and assessments for the judge to make.

In fact, the judge held that there was no infringement under S10(2) due to the descriptive nature of the common term used in both the Oatly trade marks when making the visual, aural and conceptual comparison. The judge also held that there was therefore no likelihood of confusion.

Trade mark infringement under s10(3)

In order to establish infringement under this provision of the Trade Marks Act 1994, Oatly would have needed to prove that:

  1. Glebe Farm had used PureOaty within the UK;
  2. the Oatly Trade Marks have a reputation in the UK;
  3. such use of the PureOaty mark was in the course of trade without the consent of Oatly in relation to goods and services; and
  4. the use of PureOaty must give rise to a link between the PureOaty mark and the Oatly Trade Marks in the mind of the average consumer.

The judge held that there was also no infringement under S10(3), as there was a low to moderate similarity between the marks as assessed against the criteria listed above. It was also held that there was no risk of injury to the distinctive character or reputation of Oatly’s Trade Marks, nor did Glebe Farm take unfair advantage of the same. The judge stated that if Oatly lost sales, this would be due to a rival oat drink product entering the market and not because of the attractiveness of Oatly’s brand as a badge of origin being diminished by Glebe Farm use of Pure Oaty.

Passing off

In order for Oatly to prove that Glebe Farm had passed off its PureOaty products as those of Oatly, it would need to establish that:

  1. Oatly had existing goodwill in the Oatly mark;
  2. that Glebe Farm had misrepresented its PureOaty products as those derived from Oatly; and
  3. As a result of this misrepresentation, Oatly had suffered damage.

The judge dismissed Oatly’s claim for passing off for the same reasons as he dismissed the claim under S10(2) of the Trade Marks Act 1994.

Comments

This case was an excellent example of the ‘David vs Goliath’ type of dispute that is commonly seen in IP claims.

Having a registered trade mark means that the proprietor can attempt to stop third parties from using identical/similar marks for identical/similar goods. While it is common for brand owners to want to clear the market of any signs they believe are infringing their rights, this can present difficulties when your brand is using an (arguably) descriptive term as general UK trade mark policy is such that descriptive terms should be ‘kept free’ for all to use. Where this is the case, then brand owners need to proceed with caution and pick their battles carefully.

Many brand owners do not envisage disputes occurring when choosing brand names in the first instance and brand names as well as other IP rights should therefore be a key consideration throughout the life cycle of a business.