CJEU rules that ice cream sold as ‘Champagner Sorbet’ can be branded as ‘Champagne’

Aldi Süd's Champagner Sorbet

In a judgment released earlier this week (Comité Interprofessionnel du Vin de Champagne v Aldi Süd Dienstleistungs-GmbH & Co.OHG, C-393/16) the Court of Justice of the European Union (CJEU) reviewed relevant EU legislation on protected designations of origin (PDOs) in deciding a case concerning a sorbet branded and sold as ’Champagner Sorbet’.

Katfriend Nedim Malovic (Sandart & Partners) reports.

Here’s what Nedim writes:

“Following the sale of “Champagner Sorbet” in 2012, the Comité Inteprofessionnel du Vin de Champagne (CIVC) brought proceedings against Aldi Süd, seeking an injunction from the Regional Court of Munich I that would prohibit further sale of the product under that name, despite it containing 12% champagne. According to the CIVC, Aldi Süd would infringe the PDO ‘Champagne’.

The court granted the injunction, but this was reversed on appeal. The CIVC thus brought an appeal before the German Federal Court of Justice (BGH), which stayed the proceedings and made a reference to the CJEU.

In particular, the BGH asked the CJEU whether Article 118m(2)(a)(ii) of Regulation 1234/2007 (Single CMO Regulation) and Article 103(2)(a)(ii) of Regulation 1308/2013 also apply in a case, like the one at issue, in which a PDO is used as part of the name of a foodstuff which does not correspond to the product specifications but to which an ingredient has been added which does correspond to the product specifications. The German court also wished to know whether and in what sense use of a name such as ‘Champagner Sorbet’ would constitute undue exploitation of the reputation of the PDO ‘Champagne’.

The AG Opinion

Advocate General (AG) Sanchez-Bordona issued his Opinion (not available in English) in July 2017. He reasoned that said provisions are applicable in a case like the one at issue and the referring court should assess whether there is a legitimate interest in justifying the commercial use of the PDO ‘Champagne’. The test is whether the average consumer, who is reasonably well informed and reasonably observant and circumspect, would be led to believe that a connection exists between the ingredient protected by the PDO, the packaging and labelling, and the PDO ‘Champagne’.

Champagne

The CJEU judgment

The CJEU substantially followed the AG Opinion, stating that if it tastes like champagne – it is champagne.

1. Scope of the provisions in light of the added champagne ingredient

The CJEU stated that the scope of the two provisions in each Regulation is to be understood broadly. Those provisions are encompass any direct or indirect commercial use of a PDO and protect the PDO-holder against the taking of an undue advantage over its reputation. This is in line with the objective stated in Recital 97 in the preamble to Regulation 1234/2007, ie to protect PDOs and Protected Geographical Indications (PGIs) against any against any use intended to take advantage of the reputation enjoyed by products which comply with the relevant specifications.

Furthermore, the CJEU in Bureau national interprofessionnel du Cognac  C‑4/10 and C‑27/10 (at para 55) had reasoned that use of a mark containing a PGI, or a term corresponding to that indication, constitutes a direct commercial use of that geographical indication.

  

2. Exploitation of the PDO’s reputation

EUIPO v Instituto dos Vinhos do Douro e do Porto, C‑56/16 P, and Bureau national interprofessionnel du Cognac, C‑4/10 and C‑27/10 provide guidance in situations which give rise to exploitation of the reputation regarding a protected designation of origin. The CJEU held that exploitation of the reputation of a PDO, within the meaning of Article 118m(2)(a)(ii) of Regulation 1234/2007 and Article 103(2)(a)(ii) of Regulation 1308/2013, entails, inter alia, use that seeks to take undue advantage of the reputation enjoyed by a PDO.

The use of the name ‘Champagner Sorbet’ conveys an image of luxury and prestige, and therefore may take advantage of the reputation of the PDO ‘Champagne’. Accordingly, the CJEU found it necessary to examine whether such use amounts to taking unfair advantage of the reputation of the PDO.

The CJEU considered whether undue advantage arises when products protected as PDOs are contained as ingredients in or with other products. In doing so, the CJEU sought direction in the Guidelines to the Regulation on quality schemes for agricultural products and foodstuffs (No 11517/2012)). 

Section 2.1.2 in the Guidelines sets out three conditions for determining whether a name registered as a PDO may be mentioned in the trade name of a foodstuff incorporating products benefiting from that PDO:        

-       The foodstuff in question should not contain any other comparable ingredient;

-       This ingredient should also be used in sufficient quantities to confer an essential characteristic on the foodstuff concerned;

-       The percentage of incorporation should be indicated in close proximity to the trade name

In light of the above considerations, Article 118m(2)(a)(ii) of Regulation 1234/2007 and Article 103(2)(a)(ii) of Regulation 1308/2013 should be interpreted as meaning that the use of “Champagne”, as part of and sold as “Champagner Sorbet”, constitutes exploitation of the reputation of a PDO.

Turning to whether the quantity of ingredient in question which confers on the foodstuff concerned one of its essential characteristics matters, the Court held that this is significant but not sufficient. It is necessary to undertake a qualitative assessment. As the AG also noted, it is not a question of identifying in the foodstuff the essential characteristics of the ingredient protected by a PDO but of establishing that that foodstuff has an essential characteristic connected with that ingredient. That characteristic will often be the aroma or taste imparted by that ingredient.

Keen for a toast

3. Whether use of “champagne” constitutes misuse, imitation or evocation

The CJEU answered this in the negative, holding that by incorporating “Champagne” into “Champagner Sorbet”, direct use is made of the PDO to claim openly a “gustatory quality” connected with it. This does not amount to misuse, imitation or evocation.

4. Applicability of false or misleading indications that may convey a false impression to the geographical origin of the product

According to the CJEU is possible under the above-mentioned provisions to prohibit both false and/or misleading indications regarding the PDO. This possibility relies, in particular, on the crucial element of taste.

If the foodstuff at issue in the present case did not have – as an essential characteristic – a taste attributable primarily to the presence of champagne in its composition – it would be possible to conclude that the foodstuff constituted a false or misleading indication within the meaning of Article 118m(2)(c) of Regulation1234/2007 and 1308/2013.

Conclusion

The judgment essentially bubbles down to the conclusion that the taste – connected with the ingredient in question – characterizes the exploitation of the reputation.  The AG was reasonable in suggesting this solution, primarily because it would be very difficult to leave out the element of taste in an attempt to portray an edible product’s essential characteristic.

In relation PDO’s, the CJEU confirms that these are given a relatively wide scope of protection. A PDO is in fact protected against false and/or misleading indications that are able to create a false impression regarding the origin of the product in question.  Furthermore, the implication of the “taste-element” supports the conclusion that a PDO is now also protected against false and/or misleading indications relating to the nature or essential qualities of the product.”