New York Court Finds in Favour of Tipperary in Trade Dress Fight

Further to our recent article reporting on a trade mark dispute involving Kerrygold and Kerrymaid, the former has again recently been in the trade mark wars. A New York Court ruled, September 2024, that the packages of the Kerrygold and Tipperary unsalted Irish butter products are not likely to be confused. In reaching this conclusion, the Court dismissed Kerrygold’s claims for:

• Trade dress infringement, which is a US law concept, similar to passing off in Ireland
• Unfair competition, and
• Deceptive business practices.

We consider the decision and its impact for brand owners in the food and beverage sector.

Kerrygold

Ornua Foods North America, Inc. and Ornua Co-operative Limited together known as “Ornua”, produce and sell the popular unsalted Irish butter Kerrygold in various territories including the US. Ornua filed a US trade mark application to protect the packaging of this product in 2020. The mark below was registered in the US in March 2022.

Ornua claimed that Kerrygold unsalted butter has been sold using the above trade mark since 2004. Between 2018 and 2022, it claimed to have spent over $226 million on advertisements in North America. These advertiements related to the Kerrygold brand across print, television, digital and social media. Consequently, since 2018, sales of Kerrygold unsalted butter as depicted above, account for more than 30% of the US market for unsalted premium butter products.

It also argued that sales of Kerrygold unsalted butter in the US grew from $30.9 million in 2018 to $68.6 million in 2022.

Tipperary

Abbey Specialty Foods LLC (Abbey), began selling an unsalted Irish butter in the US in February 2021 in the following packaging:

Kerrygold and Tipperary unsalted butters are often sold in the same retail stores in the US. Abbey’s owner also acknowledged that, as of December 2023, he had been aware of the Kerrygold product, as depicited in the Kerrygold registered mark, for more than 10 years. A side-by-side comparison of the competing products is set out below.

US litigation

Ornua initiated legal proceedings in New York in February 2024. It claimed, amongst other things:

• Trade mark infringement
• Trade dress infringement, and
• Unfair competition and deceptive business practices.

In response, Abbey filed a motion to dismiss Ornua’s claim and for the Court to make a final decision without a full trial.

The New York Court held that:

• The Kerrygold packaging is inherently distinctive and non-functional, and
• A likelihood of confusion does not exist between the Kerrygold and Tipperary packaging and trade dresses. In particular, a reasonable jury could not find that a likelihood of confusion exists. This was because even though the competing product packages do share certain features, the overall impressions created by both differs meaningfully. In particular:
  • Each package prominently displays the brand name. The name “Kerrygold” assumes a significant portion of the Kerrygold product and is in the centre of the package. “Kerrygold” appears in a white font sitting in front of a shamrock green quadrangle. Similarly, the name “Tipperary” occupies a large portion of the competing product and appears in the largest font of any text on that package. The Court noted that “these brand names clearly signal the products’ different sources and go far towards eliminating any possible confusion.”
  • Although both products use a Celtic-style font, each font is evidently distinct.
  • The two packages contain different phrases and otherwise arrange any similar phrases in different places. By way of example, the Tipperary package states “IMPORTED FROM IRELAND.” No such statement appears on the Kerrygold package.
  • The focal point of the Kerrygold package is the green quadrangle with the “Kerrygold” brand name and depiction of a cow grazing tufts of grass. On the other hand, the focal point of the other package is the name “Tipperary” which sits against the silver foil, and the Irish national flag.
  • Many of the features which Ornua argued would cause confusion are common to other butter products. On this point, the Court commented that even a cursory glance at the collection of butter packages Ornua assembled in its statement of material facts reveals that butter products commonly share the same size, shape and weight.

Comment

Although this case was decided by a US Court which would not bind an Irish or UK Court, the decision demonstrates the difficulties faced by brand owners who are seeking to enforce their product get-up and trade dress against competitors and copycats. To avoid these difficulties and to best protect their rights in product packaging and get-up, brand owners should consider the following:

• Filing design and trade mark applications if possible for product shapes and designs if these are unconventional, distinctive and novel.

• Before instituting legal proceedings against a potential copycat or competitor who is using very similar product packaging, take the time to gather evidence of actual consumer confusion. Ornua’s failure to produce evidence of actual confusion in this case weighed against its ability to successfully enforce its rights.

• Obtaining evidence that the owner of a similar product had “actual or constructive knowledge” of your prior use of similar product packaging may also be helpful in demonstrating bad faith on the part of the competitor.

• Obtaining evidence that the competing products are not of the same quality may also be helpful in prosecuting this type of claim.

For more information and expert legal advice on how best to protect your intellectual property rights, please contact a member of our award-winning Intellectual Property team.

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