Oatly v PureOaty: cereal killer
The Oatly brand is a mighty oak in the world of milk alternatives. In 2018 the Sweden-headquartered business sold more than 90 million units of its drinks within the EU.
Although it may seem as if plant-based milk alternatives have been around for a while, when Oatly first hit the supermarket shelves around 20 years ago, soy milk was the only mainstream option in the UK if you wanted a vegan or lactose-free alternative to cow’s milk.
The milk substitute world is very different now, with a quick Google search or visit to a high street coffee chain presenting multiple options including almond, rice, hemp, and oat-derived drinks.
One of the big drivers of this change, and one of its greatest success stories, has been the rise of oat milk and Oatly in particular. But will the branding decisions made in Malmo around 25 years ago when Oatly was just a little acorn undermine the business’ ability to protect its rights and market-leading position now that it is a mighty oak?
In many ways Oatly seems to have taken a considered approach to its branding rights. It has filed trademark registrations encompassing the words ‘Oatly’ and ‘Oat-ly!’, its logos, slogan and packaging. However, despite its good housekeeping, the inherent weakness in its core brand is inescapable: ‘Oatly’ is very close to “Oat” and vulnerable to a claim that it “designates the kind or quality of the goods”, to paraphrase the UK Trade Marks Act (1994).
The claim
These issues have been brought to the fore in a case before the English High Court.
In 2020, Oatly brought a claim against Glebe Farm Foods over the brand it uses for its oat-based milk alternative—‘PureOaty’. The claim, heard in the High Court, alleged trademark infringement and passing off.
Oatly claims that PureOaty’s branding for its oat-based drinks is confusingly similar to its trademarks ‘Oatly’ and ‘Oat-ly!’. Oatly also asserts that PureOaty is taking unfair advantage of the reputation it has established via those registered trademarks. Finally, Oatly asserts that its rival is attempting to pass itself off as having a commercial association with the Oatly brand. The two products are pictured below:
