Oatly loses brand battle against small family farm

For more accurate and relevant business and economic news, subscribe to The Daily Upside newsletter. It’s completely free and we guarantee that you will learn something new every day.

In the oat business, you get ripped off sometimes.

A UK court on Thursday dismissed an Oatly case, in which the Swedish alternative dairy giant sought an injunction against a family farm – whose assets total just 0.0007% of Oatly’s market capitalization – for endowing their product of the name not particularly similar. PureOaty.

David vs. Oatliath

Oatly is listed in New York at a valuation of $ 10 billion in May, while Glebe Farm – which started calling its oat milk PureOaty last year – had net assets of less than 6.9 million dollars in March 2020.

Despite Glebe’s relatively small business, Oatly claimed the farm’s branding was meant “to recall Oatly’s products,” asking the court to bar Glebe from using the name. and award damages and costs.

The judge had none of that, however, ruling that there was no evidence of trademark confusion. Now, humiliated by a British magistrate, Oatly turns to an even more bitter battle in the court of public opinion:

  • Shares of the company fell three weeks ago after short seller Spruce Point issued a scathing report accusing Oatly of shady accounting practices. Among other allegations, Spruce Point noted that Oatly claimed $ 12 million in U.S. revenue in 2018 during an investor presentation, while a Swedish media report put the figure at just $ 6 million.
  • Spruce Point also noted that Oatly went through Three auditors in six years, which the company failed to mention in the IPO documents. And the short seller is alleging – along with anomalies in its reported cash flow and balance sheet – Oatly’s gross margin is 6.4% lower than the company claims.

Becoming ugly for Oatly: Spruce Point fired no shots, even suing Oatly’s environmental record: The short seller got hold of government records showing the Oatly plant in New Jersey is consuming even more water than it does. ‘it does not take to make cow’s milk and it does not comply with the EPA.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Source link

About Daisy Rawson

Check Also

Retiree’s Guide to Mortgage Refinancing

Put your papers in order As with any mortgage, you’ll need to qualify, so your …

Leave a Reply

Your email address will not be published. Required fields are marked *