Fage UK Ltd & Anor v Chobani UK Ltd & Anor

The Court of Appeal confirms that a geographical or descriptive name may acquire a secondary meaning and become distinctive of a particular class of goods for the purposes of extended passing off where a substantial section of the relevant purchasing public understands the name to denote products of a particular character; in such circumstances use of that name for products outside the defined class can amount to a material misrepresentation, deception and damage and justify injunctive relief.

This is an appeal from Briggs J in the Chancery Division ([2013] EWHC 630 (Ch)) concerning whether the descriptive phrase 'Greek yoghurt' had, in the UK market, acquired distinctiveness as denoting a thick, creamy yoghurt made in Greece so as to found an extended passing off claim against an importer selling a strained yoghurt made outside Greece under that description. The judge found that a long-standing unwritten labelling convention in the UK and trade and consumer evidence showed a substantial section of purchasers associated the phrase with yoghurt made in Greece and that this mattered to them; he granted a permanent injunction. The Court of Appeal (Longmore, Lewison and Kitchin LJJ) dismissed the appeal, upholding the judge's findings on distinctiveness, misrepresentation and damage and rejecting arguments based on EU Regulation No 1151/2012 that the national law remedy was displaced.

1. Overall disposition: The appeal is dismissed and the judge's order granting a permanent injunction restraining the defendant from marketing its US-made strained yoghurt as "Greek yoghurt" is restored. (See operative reasoning at [111].)
2. Distinctiveness and extended passing off:
   1. The court restates that an initially descriptive (including geographical) name may acquire a secondary meaning and become distinctive of a defined class of products when, to a substantial section of the relevant public, it denotes goods of a recognisable type with a reputation or cachet. (Authorities considered: Erven Warnink, J Bollinger, Chocosuisse.) (See [62]–[69], [112]–[116].)
   2. On the judge's unchallenged factual findings concerning a UK labelling convention, trade evidence, market research and pricing, it was open to him to conclude that a substantial proportion (probably a clear majority of Greek-yoghurt buyers) understood "Greek yoghurt" to denote a thick, creamy yoghurt made in Greece and to regard that origin as material to their purchasing decisions. That conclusion supplied the necessary foundation of goodwill. (See [112]–[116], [133]–[135].)
   3. Where such goodwill exists, applying the conventional elements of passing off (goodwill, misrepresentation, damage) the use of the same or similar name by a competitor outside the defined class will amount to a material misrepresentation and cause damage; an injunction is an appropriate remedy. (See [29], [30], [133]–[136].)
3. Class definition and precision: The protected class must be definable with reasonable precision. The court accepted the judge's description (yoghurt made in Greece, traditionally strained, without specified additives) as sufficiently precise for the purposes of the tort and that traders making such product in Greece comprise the class entitled to share in the goodwill. (See [68]–[76], [118]–[123].)
4. Extent of deception test: Domestic passing-off jurisprudence requires proof that a substantial number of relevant purchasers will be misled; the court declined to allow a new argument invoking the EU "average consumer" test to be taken at this late stage because it raised complex issues and would have prejudiced the claimant. No final view on the compatibility question was reached. (See [76]–[79], [175]–[176].)
5. EU Regulation No 1151/2012:
   1. The court examined the 2012 Regulation (and predecessors) and the CJEU authorities. It held that the Regulation provides a uniform and exhaustive protection for the names within its scope but does not preclude national protection by passing off for denominations which do not fall within that scope. (See [81]–[89], [163]–[169].)
   2. On the facts found by the judge, "Greek yoghurt" is not a denomination used in Greece (there it is described as the equivalent of "strained yoghurt") and therefore cannot be registered under the Regulation; accordingly the Regulation does not displace national passing-off protection in this case. (See [95]–[106], [171]–[174].)
6. Procedural and appellate practice: The court emphasised the appellate restraint in overturning trial findings of fact and credibility; new points of law that go to jurisdiction or illegality may exceptionally be raised on appeal if all relevant facts are before the court, but here the Regulation point was either without merit on the facts or raised too late to be permitted in amended pleadings. (See [114]–[116], [78]–[81], [149]–[156].)
7. Order: Appeal dismissed; Briggs J's judgment and permanent injunction restored. (See [111].)

• Court of Appeal (Civil Division) — Appeal from the Chancery Division of the High Court; judgment dated 28 January 2014; appeal dismissed and the judge's permanent injunction restored.
• High Court (Chancery Division) — Briggs J: trial judgment 26 March 2013, ([2013] EWHC 630 (Ch)) finding for the claimant in extended passing off and granting a permanent injunction.