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Crunchtime for peanut butter as battle heads to High Court

Kraft Heinz is not backing down in its dispute with Bega over peanut butter jars.

Kraft Heinz is not backing down in its dispute with Bega over peanut butter jars.

“On 19 May 2020, Bega Cheese received notice that Kraft-Heinz has filed an application in the High Court seeking special leave to appeal from the judgment of the Full Court of the Federal Court of Australia,” Bega said.

ASX-listed Bega’s lengthy heritage is as a dairy company, but in 2017 it entered the peanut butter world when it purchased Kraft subsidiary Mondelez Australia (formerly called Kraft Foods Limited). Bega obtained the peanut butter business, assets and goodwill of Mondelez under the deal.

After the deal was completed, both Bega and Kraft sold peanut butter in Australia in jars that were strikingly similar.

Both parties counter-sued one another in the Federal Court for misleading and deceptive conduct under competition and consumer law.

Kraft told the Federal Court that the distinctive peanut butter trade dress was never Mondelez’s to sell. But in his ruling last year, Justice David O’Callaghan said Bega had acquired “all rights” to the trade dress when it bought Mondelez.

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Trade dress is considered an important identifier of a product, and operates like a trade mark.

In a statement to The Age and The Sydney Morning Herald on Wednesday, Kraft Heinz said it was “disappointed with the recent decision of the Full Court of the Federal Court and has filed an application for special leave to appeal with the High Court”.

Bega shares closed down 3.5 per cent at $5.17 on Wednesday, on a day when the S&P/ASX200 climbed 0.2 per cent.

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