UK: Greek Yoghurt: As Distinguished As Champagne?

Last Updated: 14 March 2014
Article by Harry Jupp

In a recent judgment, the Court of Appeal has considered the law of so-called "extended passing off" and its relationship with the European Union legalisation that protects geographical indications of origin, all in relation to the trade name "Greek yoghurt".

"Greek yoghurt" or "Greek style yoghurt"

In the UK, there are two classes of "Greek" yoghurt:  yoghurt sold under the term "Greek yoghurt" and yoghurt sold under the term "Greek style yoghurt".

Both yoghurts are thicker and creamier than ordinary yoghurt and are representative of the yoghurt that has always been made in Greece.  However, that is where the similarities normally end.

Greek yoghurt should be yoghurt that has been thickened by a traditional Greek method called straining, has been made in Greece, and does not contain any additives. Greek style yoghurt is usually thickened by thickening agents to create its consistency and most of this yoghurt sold in the UK has not been made in Greece.  All of this is reflected in the premium price Greek yoghurt demands compared to Greek style yoghurt.

Extended passing off

Thus, when the US yoghurt company Chobani introduced its yoghurt onto the UK market in September 2012 as Greek Yoghurt despite the fact it had not been made in Greece, the UK's Greek yoghurt market leader, FAGE (owner of the TOTAL brand), almost immediately issued proceedings for an injunction on the basis of the law of extended passing off.

The less familiar area of passing off law known as "extended" passing off has developed over the years as a result of actions brought by or on behalf of a class of producers sharing a collective goodwill or reputation in a product which shares a common name or get-up.  For example, some of the most famous cases on the subject have dealt with the goodwill in champagne, sherry, Scotch whisky, Swiss chocolate and vodka.

In this case, FAGE said that it sold yoghurt under the trade name "Greek yoghurt", which in the minds of the UK public meant thick and creamy yoghurt made in Greece, and differed from "Greek style yoghurt" which to the UK public meant thick and creamy yoghurt that was made other than in Greece.  FAGE argued that this showed there to be a valuable reputation and goodwill in the phrase Greek yoghurt in the UK to describe a thick, creamy yoghurt made in Greece.  It followed, therefore, that the sale by Chobani of US-made thick and creamy yoghurt under the phrase "Greek yoghurt" was a misrepresentation which would cause damage to FAGE.

At first instance, the High Court agreed with FAGE and ordered a permanent injunction stopping Chobani describing its yoghurt as "Greek yoghurt". 

The Court of Appeal

Chobani appealed on the grounds that Greek yoghurt was insufficiently distinctive to acquire the requisite goodwill for extended passing off and that the EU Regulations concerning the geographical indications for food prevented the Court from even applying the law of passing off.

(1) Greek yoghurt: a lack of distinction?

In considering the first of these two grounds, the court undertook a comprehensive review of the key authorities and facts on point and found, again, in FAGE's favour.

It said, inter alia, that:

  • the phrase "Greek yoghurt" meant a particular and singular product which was desirable to a significant section of the relevant public (a substantial part of Greek yoghurt buyers).  There was thus goodwill in the phrase;
  • it did not matter whether the public knew of the specification to which Greek yoghurt was made; and
  • Greek yoghurt traders can be defined with reasonable precision – it was all those traders whose yoghurt is made in Greece by the straining method with no additives.

(2) The EU Regulations on geographical indications for food

Chobani also denied that the court could even apply the law of passing off given that the phrase "Greek yoghurt", in its view, fell within the EU Regulations on geographical indications for food. 

The court, however, disagreed.  It said that in order to fall under the regulations, the phrase "Greek yoghurt" had to be used in Greece and have a reputation there.  But, as the phrase had never been used in Greece to describe the yoghurt (it was called just "strained yoghurt"), it fell outside the scope of the Regulations and did not preclude the English courts from protecting the use of the geographical term "Greek yoghurt".

Comment

One of the main points that comes across from this decision is that, like most passing off cases, it relied heavily on the factual evidence of the case, which undoubtedly swayed the court that Greek yoghurt had the requisite goodwill to claim protection under the law of passing off.

This was also the first time in a major case that the court has looked at the question of whether passing off is disapplied because of the EU Regulations on geographical indicators of food.  The court has helpfully gone through the requirements needed in order for a defendant to resist a passing off allegation, and we envisage that this may now cover many examples of descriptive terms which have been applied to a particular class of food.

Further, as the most recent decision of the Court of Appeal on point, this case is of interest as it provides the best evidence of the court's current thinking on the area of extended passing off.  Furthermore, we understand that the decision may be appealed to the Supreme Court.  If that happens, it will present the latter with an opportunity to comment on and possibly improve or clarify the leading authorities on the law of passing off.  In particular, there is a concern among the judiciary that the law of passing off may have gone too far and be preventing healthy competition in relatively low-cost generic goods.

To be continued it seems...

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