Fonterra has lost a legal battle to block Bega Cheese from using the Bega brand on a range of peanut butter.
Key points:
- Bega Cheese has won the right to continue using its brand on peanut butter and other products
- The decision was handed down in the Supreme Court of Victoria this morning
- Bega had previously granted a licence to Fonterra to use the Bega brand on a range of cheeses
A drawn-out legal battle between the two dairy industry heavyweights was resolved in the Supreme Court of Victoria this morning.
The two companies reached an agreement for Fonterra to produce Bega-branded cheese under a deal struck in 2002.
But in 2017, when Bega Cheese purchased a range of well-known products including the household favourites of peanut butter and Vegemite, a fight ensued.
Fonterra today lost its bid to stop that use, after previously claiming it diluted the “distinctiveness” of the Bega brand, which had traditionally been associated solely with cheese.
The court also dismissed a counterclaim filed by Bega Cheese.
Bega Cheese alleged Fonterra had breached a contractual obligation to market and promote the Bega brand, however, the court found there was no obligation for Fonterra to do so.
Bega Cheese also contended that Fonterra breached an agreement between the two companies by misrepresenting to consumers that all cheese in Bega products was made in the Bega Valley. That claim was also dismissed.
Fonterra retains Bega Cheese licence
In a statement, Bega Cheese said it was pleased the court had confirmed its right to use the Bega brand on peanut butter products purchased from Mondelez in 2017.
“In practical terms, this means that while Fonterra has an ongoing licence to use the Bega trademark on natural and processed cheddar cheese, string cheese and butter … Bega Cheese is entitled to use the Bega trademark on products outside of the scope of the licenced products including on peanut butter,” it said.
Fonterra said it was pleased with the decision that it would retain the exclusive licence for the Bega Cheese brand for cheese and butter.
However, it was disappointed with the decision on the trademark claim.
“We are confident that we can work together with Bega … to continue to grow the value of the brand,” Fonterra said in a statement.
Costs are yet to be determined.
