In 2012 Chobani began to sell its yoghurt in the UK. FAGE, alleging passing off, applied for an interim injunction. FAGE maintained that thick and creamy yoghurt was properly labelled “Greek yoghurt” only if it both came from Greece and was thickened by straining, and that there was an understanding to that effect on the part of the yoghurt-eating public so that use of the same phrase to describe yoghurt which was not made in Greece in that way would involve a damaging misrepresentation. No, said Chobani: the description “Greek yoghurt” denoted no clearly identified distinctive class in the minds of the yoghurt-buying public. An interim injunction was granted and the action then went to full trial on two issues:
(i) did use of the term “Greek yoghurt” by Chobani constitute an act of passing off?
(ii) on a counterclaim for malicious falsehood by Chobani, was a letter sent by FAGE to the Trading Standards Team of the London Borough of Camden actionalbe? This letter asserted that Chobani had breached EU regulations, that it had failed to mark its products with a requisite identification of their place of manufacture, and that it had failed to make it clear that it could not confirm that its yoghurt was free from artificially introduced bovine growth hormone. According to Chobani, these falsehoods were made recklessly and therefore maliciously, and in a manner calculated to cause it pecuniary damage, in particular because FAGE’s letter asked Camden Trading Standards to order the removal of Chobani's product from retail sale pending investigation of those allegations.
- For any claimant to demonstrate ownership of the requisite goodwill attached to the relevant trade name or get-up, that term had to be associated, in the mind of the public, with a clearly defined class of goods which was sufficiently distinguished from other similar goods by that name.
- Where, as here, a trade name was descriptive of geographical origin, it had to have an effect that was more than purely geographical, but that effect did not need to be a reputation for higher quality or cachet; nor did the consumer need to know how the product in question was made.
- The perception that the relevant trading name denoted a distinctive class of product needed to be that of merely some section of the public, and it was for FAGE to show (i) that it had built up a substantial goodwill attached to the trade name “Greek yoghurt” by which they -- and indeed others -- had described their product and (ii) that Chobani's use of the same or a similar name caused or threatened to cause substantial damage to that goodwill. Both these questions were matters of both fact and degree.
- On the facts a substantial proportion, probably more than 50 per cent, of Greek yoghurt consumers in the UK thought it was made in Greece; the proportion of Greek yoghurt purchasers to whom that mattered was substantial, even if that group of consumers constituted only a modest proportion of yoghurt eaters as a whole. A perception that there was something special about products labelled “Greek yoghurt”, which was less than fully matched for example by products labelled “Greek-style yoghurt”, was entertained by a substantial proportion of British yoghurt-eaters, and probably by a majority of those who were regular buyers of Greek yoghurt -- 95 per cent of which was produced by FAGE. On this basis FAGE could be said to have shown that substantial goodwill had become attached to the use of the term “Greek yoghurt” as denoting more than merely the geographical origin of the yoghurt.
- The best evidence of the subsistence of goodwill in the term “Greek yoghurt” was (i) the fact that UK yoghurt producers had respected the labelling convention for more than 25 years, (ii) the unanimity of the trade witnesses in that respect and (iii) the fact that products so labelled were able to command a premium price, even when not made by FAGE. This showed that the use of the term “Greek yoghurt” to describe yoghurt not made in Greece involved a material misrepresentation; whether Chobani's yoghurt was made by the straining method commonly used for the production of Greek yoghurt was therefore immaterial.
- The introduction into the market of a product labelled “Greek yoghurt” but made in the US would obviously damage the distinctiveness of the description “Greek yoghurt” as meaning, inter alia, yoghurt made in Greece. FAGE was therefore entitled to a permanent injunction to stop Chobani passing off its US-made yoghurt in England under the description Greek yoghurt.
- Chobani’s counterclaim for malicious falsehood failed. The allegations, even if they were false, were not malicious; nor had they been calculated to cause damage.
Merpel is musing about the following scenario. Let's say that the evidence showed that, within the UK trading circles, manufacturers, distributors, wholesalers and retailers all scrupulously observed the convention that "Greek yoghurt" was strained and of Greek origin, while "Greek style yoghurt" was not -- but the Greek yoghurt-eating public had no idea that they were different and regarded them as interchangeable terms for equally thick, creamy and delicious yoghurt. How would the judge have approached the evidence then?
Both Kats agree that, given the fact that there is a lot of money at stake, that the two parties have gone to court with much the same zest that a terrier would go for a postman's leg, and that there is a long-standing, generally well-respected convention of appealing extended passing off cases (think Vodkat, Advocaat, Chocosuisse, Champagne (Taittinger v Allbev)), this case may soon before the Court of Appeal -- but not before Lord Justice Briggs ...
How to make Greek yoghurt at home (but don't try this at home unless you like in Greece ...) here
Greek yoghurt chocolate mousse here
Greek yoghurt: positive and negative effects here
Justice Greek Style v American Style here