Bega wins peanut butter war with Kraft as High Court dismisses appeal

An American food titan has failed in its last-ditch attempt to stop Aussie food maker Bega Cheese from using a distinctive label on one of its most popular breakfast spreads.

Aussie food maker Bega Cheese has had a sweeping victory in its David vs Goliath battle with US titan Kraft Heinz over peanut butter.

The nation’s highest court has ended Kraft’s bid to force Bega into changing the packaging on jars of its popular spread.

In a long-running battle for dominance at the Aussie breakfast table, Bega had chalked up successive wins against Kraft in the Federal Court, but Kraft appealed to the High Court.

The High Court on Friday dismissed that appeal, leaving Kraft with no further legal route to force Bega’s hand.

The two labels which are at the centre of the dispute.

In a statement, Bega said the decision confirmed its right “to use the current packaging of its smooth and crunchy peanut butter products”.

Bega Foods executive general manager Adam McNamara said the group was “extremely pleased with today’s decision”.

“Today, like every day, we’re a proud Aussie business, and we look forward to continuing to produce and supply Australia’s favourite peanut butter to our loyal customers,” Mr McNamara said.

Mondelez Australia — a company that was previously part of Kraft’s global food empire — sold its Kraft-branded peanut butter business to Bega in 2017.

Bega also bought Vegemite and a series of other brands as part of the same deal.

The Australian company has continued making the peanut butter at the Port Melbourne site where it has been produced for more than 50 years.

It has also continued to use broadly the same branding, colours and jar style — known as the “trade dress” — for the peanut butter, albeit while removing the Kraft logo.

The peanut butter, which is among Australia’s top-selling brands, features a yellow lid and distinctive yellow label with a stylised image of a big peanut in blue for the smooth variety and in red for the crunchy variety.

Kraft wanted to use that packaging as it pushed back into the Australian peanut butter market in competition with Bega.

But Bega argued it bought rights to the packaging as part of its deal with Mondelez – a position the Federal Court supported.

Barry Irvin is the executive chair at Bega, which also owns Vegemite. Picture: Stuart McEvoy.

Last year, that court ruled in Bega’s favour, and earlier this year, the same court dismissed an appeal by Kraft, prompting it to appeal to the High Court.

In August, Bega revealed it had spent almost $10m the past financial year on “legal and other expert advisory fees” relating to its battle with Kraft and a separate trademark dispute, with New Zealand dairy group Fonterra.

Bega, best known for its cheese products, has been expanding into different markets in recent years and this year launched its first brand of honey, called B Honey.

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