Oatly, the oat-based dairy-alternative business headquartered in Sweden, has taken legal action against the UK’s Glebe Farm Foods over an alleged trademark infringement.
Investor and celebrity-backed Oatly, which went public in the US last month, is seeking an injunction to stop Glebe Farm from selling its PureOaty brand.
It is also seeking damages and costs, claiming infringements related to the Oatly brand and pack design and of “passing off” the beverage as Oatly, the Financial Times reported, having seen documents filed at London’s High Court on Wednesday (9 June) at the start of a two-day trial.
No result of that trial has yet to emerge.
Glebe Farm acknowledged the court action in a statement on its website, saying Oatly claims the PureOaty name and packaging “is too similar” to its own.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
For its part, a spokesperson for Oatly said in a statement: “We approached Glebe Farms in a letter in early 2020 telling them we think their branding infringed our trademark. We unfortunately did not receive a constructive response from them. We are therefore now involved in an ongoing court case, and we have no further comment as we await the results.”
Philip and Rebecca Rayner, the brother and sister team behind Glebe Farm in Huntington, Cambridgeshire in the east of England, said “we don’t believe we have done anything wrong”, adding that it may take a number of weeks before a court decision is forthcoming.
“Aside from fighting their claim as it is, there are deeper principles at play here for us as a family farming business in wanting to challenge back,” they said. “We will update what happens when we know what the ruling is, and in the meantime will focus on what we prefer to spend time on: delivering our delicious PureOaty oat drink to discerning customers across the UK and beyond.”
The Rayners founded the business in 2008. It supplies the gluten-free oat drink PureOaty, along with porridge flakes and oat flours to UK retailers and the foodservice channel, as well as online through its own website. Stockists include The Co-op, Holland & Barrett, Booths and Amazon.
According to the FT, Oatly’s lawyers in the UK claim that when Glebe Farm rebranded its oat-drink product as PureOaty in 2020, “Glebe Farm’s intention was to bring Oatly’s products to mind and thereby to benefit from the huge power of attraction”.
Ishen Paran, the general manager of Oatly’s UK unit, was said by the FT to have told the court on Wednesday he “suspected the launch of PureOaty was linked with supply shortages of Oatly reported in 2019”.
Malbo-based Oatly, which also produces plant-based drinks, yogurt, ice cream and spreads, supplies around 20 global markets, including the UK, the US and Australia.
Oatly also found itself embroiled in a separate trademark dispute last year with BetterBody Food and Nutrition, a US-based natural ingredients business, over the use of the US firm’s Oatsome brand.
Last summer, Oatly sold a minority stake as part of a US$200m financing round led by US-based private-equity firm Blackstone Group, with contributions from rapper Jay-Z’s entertainment company Roc Nation, celebrities Oprah Winfrey and Natalie Portman, former Starbucks chief Howard Schultz, and Rabo Corporate Investments, the investment arm of Rabobank.
And in 2016, the Belgium-based private-equity firm Verlinvest and Chinese state-owned conglomerate China Resources took an undisclosed stake in Oatly via a new joint venture focused on health and consumer products.