In a recent Court decision, Oatly’s claims of trademark infringement and passing off brought against Pure Oaty have been dismissed by the Intellectual Property Enterprise Court.
Background
The Claimant, Oatly, sells an oat-based dairy alternative drink under the brand name OATLY and registered various trademarks between 2000 and 2018.
Between 2018 and 2021, Oatly’s barista grey addition was the bestselling UK dairy alternative drink. In addition, Oatly’s other products were sold across some 20,000 retail outlets.
In January 2019, the Defendant, Glebe Farm, began selling an oat-based drink called “Oat Drink”. In 2020, it rebranded its packaging and released the product under the name PUREOATY with similar blue packaging to Oatly’s products. The Defendant also used similar slogans to Oatly and advertised its drink as being suitable for use by baristas.
The Court’s Decision
Following the commencement of Court proceedings, Oatly’s claims ultimately failed due to a lack of evidence of actual customer confusion and the low level of similarity between the two brands.
Regarding the trademark infringement claim, Oatly’s strongest case concerned the word mark OATLY and the Defendant’s use of the word mark PUREOATY.
The judge held that these two signs had a modest level of visual and aural similarity. Conceptually, PUREOATY was likely to be seen by consumers as two descriptive words joined together, whereas OATLY makes use of the “LY” to create a made-up word that referred to the oatiness of its drink. Even more importantly, Oatly was not able to provide any documentary evidence of consumer confusion despite the Defendant having sold over 500,000 units. Oatly’s other claims, which related to its other trademarks and its packaging, were even weaker. Furthermore, the judge held that there was no evidence that the Defendant’s use of PUREOATY would injure the distinctive character of Oatly’s trademarks.
Finally, the judge held that the similar elements between PUREOATY and Oatly’s trademarks were merely descriptive.
As a result, Oatly’s trademark infringement claim failed.
Oatly’s passing off claim also failed for the same reasons its trademark infringement claim failed given that the Defendant’s conduct did not amount to misrepresentation, i.e. that its oat-based milk drink was in some way associated with the products sold by Oatly.
Conclusion
This case is an excellent reminder of the importance of evidencing consumer confusion in trademark infringement and passing off claims. If consumer confusion cannot be evidenced by the time of trial, then this can often be determinative and mean that trademark infringement and passing off claims may not succeed.
In this case, the Court’s decision will be reassuring to brands and trademark practitioners because it confirms that it is not possible to assert monopoly rights over how products and services are described.
Here to Help
We have a specialist Intellectual Property Disputes Team that routinely advises on a broad range of disputes relating to trademarks along with other intellectual property disputes relating to copyright, patents, confidential information and data protection.
If you need advice on trademark or other intellectual property infringements, please do not hesitate to contact a member of our Intellectual Property Disputes Team on 0161 941 400, or you can email the Intellectual Property Disputes Team.