Thursday, April 25, 2013

Singapore Law Watch - Nestle sues locally listed Petra Foods

Take-it chocolate wafers look similar to its Kit Kat, says Swiss company

SWISS food giant Nestle has started legal proceedings against a locally listed food company over alleged trademark infringements of its popular Kit Kat chocolate bars.

Nestle claims that a Petra Foods product called Take-it has a shape similar to the famous Kit Kat. It also wants production of the chocolate bar stopped.

The company said the Take-it chocolate wafers look similar to its Kit Kat product, according to Nestle's 76-page document filed with the High Court last December.

Kit Kat bars are usually sold in two forms - two bars of chocolate wafers stuck together or a four-bar version.

Nestle calls these the "two fingers" and the "four fingers" shapes and has trademarked them in Singapore and 20 other countries.

It alleges that Petra Foods has infringed on the trademarked shape of the Kit Kat with its Take-it product, which it produces under the Delfi brand.

It stated that the Take-it bar's "shape, size, weight, finishing, proportions, look and feel were deliberately chosen to mirror the Kit Kat with two fingers" and four fingers.

The Swiss company, which is valued at more than 200 billion Swiss francs (S$265.3 billion), said chocolate bars identical, if not similar, to the Kit Kat's two- and four-finger shapes started being sold as early as 2010 in countries such as the Philippines, Indonesia and Singapore.

Nestle's 21 claims in court documents include demands that Petra Foods halts production of the two- and four-finger chocolate wafers and pays damages and costs.

Petra Foods, in response, said Kit Kat has been promoted and sold for its brand name "Kit Kat" and its slogan "Have a break, have a Kit Kat".

It was not marketed based on the two- and four-finger shapes of the chocolate wafers.

Petra Foods also noted that its chocolate wafers were not sold based on the shapes but its own brand name, Delfi's Take-it.

Petra Foods is counter-suing Nestle over the validity of the two-finger and four-finger trademarks and wants them cancelled.

It has also accused Nestle of "groundless threats" of legal proceedings for trademark infringement.

Petra's latest annual report stated that its branded consumer division, which includes the regional chocolate confectionery business, recorded revenue of US$477.7 million (S$592.4 million).

Sales of the Take-it chocolate wafers in Singapore are estimated to be less than 0.1 per cent of its Asian chocolate sales.

The legal tussle over chocolate wafer trademarks is not unique to Singapore.

Cadbury recently lost a trademark lawsuit to Nestle's Kit Kat over four-bar-shaped chocolate wafers.

That dispute dates back to 2007 when Cadbury challenged Nestle's registered trademark over the shape of Kit Kat chocolate wafers in the European Union. Cadbury appealed and won.

Cadbury's Crispello is a wafer chocolate that is similar to the Kit Kat.

The European Board of Appeal overturned the decision and ruled in favour of Nestle in January.

The Straits Times understands that Cadbury has filed an appeal against that decision.

The case of Nestle and Petra Foods is in the preliminary stage. Both sides are presenting their cases and relevant information and findings to the High Court.

Petra Foods makes cocoa ingredients and distributes chocolate confectionery, among other consumer products.

Its chief executive, Mr John Chuang, was named Businessman of the Year at last year's Singapore Business Awards.

Petra Foods shares closed three cents down at $4.14 yesterday.

rjscully@sph.com.sg


Background Story

Nestle's 21 claims in court documents include demands that Petra Foods halts production of the two- and four-finger chocolate wafers.

Source: Straits Times ? Singapore Press Holdings Ltd. Permission required for reproduction.

Source: http://www.singaporelawwatch.sg/slw/headlinesnews/23947-nestle-sues-locally-listed-petra-foods.html?utm_source=rss%20subscription&utm_medium=rss

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