Brief: Oatly loses trademark infringement case against UK farm

• Oatly has been defeated in an IP infringement case it brought in the UK High Court targeting local plant-based foods producer Glebe Farm.
• In its complaint filed earlier this year, the Sweden-based, US-listed company had claimed that Glebe Farm’s PureOaty brand of oat-based milk infringed on its trademark rights.
• The court today dismissed Oatly’s claims of trademark infringement and ‘passing off,’ ruling that there is no likelihood of confusion between PureOaty’s and Oatly’s branding.
• “You only need to look at the two products and packaging side by side to appreciate how different these brands are, and how unnecessary this legal action was,” Glebe Farm owner Phillip Rayner said in a statement. “We greatly appreciate the huge support that PureOaty and Glebe Farm have received from around the world, including 130,000 signatures on a change.org petition.”

Why it matters:

Oatly — which went public in a $1.43 billion New York IPO in May — said it had contacted Glebe Farm in early 2020 to inform it of the alleged infringement, but had “received no constructive response.” It had argued that Glebe Farm’s intention “was to bring Oatly’s products to mind and thereby to benefit from the huge power of attraction and reputation of Oatly’s branding.”

The decision marks another PR setback for Oatly, which has been under fire from various quarters of late. Last month, short seller Spruce Point Capital Management issued a memo accusing Oatly of greenwashing and “accounting shenanigans,” sending the company’s share price tumbling by 9% on the day.