News

Bega wins peanut battle

By Dairy News

Bega Cheese has won the right to use the trademark yellow lids on its peanut butter jars, ending a long-running legal battle with American food giant Kraft.

The Federal Court ruled in April that Bega owns and has exclusive rights to use the yellow lid, and red and blue labels that most Australians associate with the peanut spread.

The fight over product appearance and copyright ownership was sparked by a tricky series of takeovers in which Kraft was bought by international giant Heinz and the Australian products including peanut butter moved under the Mondelez umbrella that was later bought by Bega.

Kraft went to the Federal Court alleging Bega engaged in misleading or deceptive conduct over the marketing of its peanut butter.

After the sale of Mondelez to Bega, the Australian dairy brand ran ads claiming “Kraft peanut butter is now Bega peanut butter” and that it was “never oily, never dry, with the same taste you’ve always loved, and is now Aussie owned by Bega”.

Bega took over the former Victorian Kraft factory in Port Melbourne as part of the sale.

Federal Court Justice David O’Callaghan delivered his judgment declaring that while the goodwill generated by the trademark branding had rightly benefited Kraft, and later Kraft and Mondelez, those rights had been transferred to Bega as part of the sales agreement between it and Mondelez.

As a result, Bega is now “exclusively entitled” to use the yellow lid, and red and blue peanut label.
Justice O’Callaghan found Bega had breached consumer law with respect to its first advertisement, but Kraft also breached the law in an October 2017 press release when it described its product as “loved since 1935.”

Bega’s executive chairman Barry Irvin announced the win to shareholders with a statement to the Australian stock exchange. “Importantly, this gives Bega Cheese the right to continue to use the current packaging of its smooth and crunchy peanut butter products,” he said.

The company will review the 178-page judgment before making any further announcements.