In today’s Finshots, we explain why Intercontinental Great Brands which owns the Oreo biscuit brand took Parle to court

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The Story

Oreos with milk at home. Oreo cheesecakes, shakes, and pancakes at the cafe. Oreo dessert recipes across the internet. Let’s face it — Oreos are everywhere and everyone loves these black-and-white biscuits.

Since the biscuit is so darn popular, you can bet that other brands will try and copy an Oreo, right?

Well apparently, that’s just what Parle, the folks behind the famous Parle-G biscuits, did in India.

They looked at all the trademarks that Oreo had registered to protect its brand — including the name, the blue packaging, the embossing or design on the biscuit — and they probably thought, “How can we do something similar?”

And voila, FAB!O was born in 2020. Yes, it has an exclamation point in the middle of the name. But we’ll get to that. It even came in nice blue packaging.

Oreo was livid. It felt this was a blatant copy. So in 2021, it took Parle to court. Their lawyers butted heads. And finally, a single Judge of the Delhi High Court passed his judgement on Friday.

What did he say, you ask?

Okay, before we get into the nitty-gritty of the Judge’s observations, you have to know one thing. It’s crucial. If you read the 50-page order, you’ll see that the judge keeps referring to — “a customer of average intelligence and imperfect recollection.”

Now the reason for that is simple. The judge cares about the masses. Regular consumers who may or may not be literate. Someone who’s not regularly consuming these biscuits. Because these are the people that brands can conveniently trick. And that’s the segment the judge pays attention to.

Anyway, let’s break down Oreo’s complaint into 3 parts.

  1. Brand name
  2. Packaging
  3. Design of the biscuit

Let’s start with the brand name.

See, Oreo has a problem with the name Fab!o. And on the face of it, you can’t really see anything similar, right? The Parle brand is basically an amalgam of two words (if you can call it that) — There’s Fab with an exclamation mark. And there’s the letter O.

So it’s really FabO. Parle says the exclamation was just to “incorporate a fun element in the mark and make it unique vis-à-vis other mark.” After all, it did register the name FABO in 2010. And it also sells biscuits with an exclamation mark — like the Fab! Bourbon.

So it wasn’t a premeditated and targeted attack on Oreo which only launched in India in 2011.

Okay, let’s accept that. The name is dissimilar. But there’s phonetics. Or how the word is really pronounced. And how do you pronounce FAB!O?

Well, this is where Parle dug its own grave. Because as per Parle’s own social media posts, it clearly says, ‘fab-ee-yo’. That sounds quite similar to how we’d say O-ree-yo, no?

The end result? Even the Judge scoffed at Parle’s argument that the exclamation point was added just for fun. He said it was a clear sign of trying to copy Oreo. Especially since none of its other biscuits had an O after the exclamation mark.

Now Parle still tried to wriggle their way out of it.

They said, “Look, if the first syllable of two marks is different, we cannot say they’re phonetically similar.” And they pointed out what happened to Tanishq. Around 20 years ago, the jewellery arm of the Tata Group found that a jeweller who ran Khazana Jewellery had decided to launch a new brand in Chennai — called Kanishk. So Tanishq filed a case. It felt like it sounded too similar and people would get confused. The court looked at its merits and actually ruled against Tanishq. Kanishk was left alone to continue running its store.

But this time, the Judge was having none of that. Instead, he referred to another case between Amritdhara Pharmacy and Satyadeo Gupta from 1962. One of them had a product called Amritdhara and the other sold Lakshmandhara. Both of them were medicinal products. And the Supreme Court said and we quote, “the question has to be approached from the point of view of a man of average intelligence and imperfect recollection. To such a man the overall structural and phonetic similarity of the two names “Amritdhara” and “Lakshmandhara” is, in our opinion, likely to deceive or cause confusion”

So yeah, the first syllables don’t really matter.

But the Judge didn’t stop there. He had a final nail in the coffin for Parle.

It seems that there aren’t really other biscuits in the market that ends with an ‘eo’ sound. It’s just Oreo. And that makes it a distinguishing feature of the brand.

So when Parle decided to call its biscuits ‘fab-ee-yo’, it would definitely confuse someone who’s of ‘average intelligence and imperfect recollection’.

Then there’s the packaging

Parle listed all the ways in which packaging is different. Such as placing the Parle brand logo prominently on the package — 7 times in fact. Compared to just one mention of Cadbury on an Oreo packet. It said that its packaging was a lighter shade of blue when compared to an Oreo. That it showed 2 biscuits on the pack. While Oreo showed one biscuit being dunked into a glass of milk.

And it also said Oreo has to prove that its colour and packaging have become its own brand. That people associate this type of packaging only with Oreo.

It even brought attention to a case in the US which featured Oreo’s original maker Nabisco. The court had observed that when it comes to biscuits, it’s near impossible to find a new colour for packaging. Everything was already taken — the red, blue, and yellow. So people are used to that. They’re not going to be confused about the biscuit just by looking at the colours.

And on the face of it, that sounds like a solid argument, right?

But…there’s a legal principle called the ‘initial interest confusion’. Put simply, if a brand packages itself in a deceptively similar manner to a rival, it can cause confusion to the customer. And in Parle’s case, despite all the differences it pointed out, it used this blue colour packaging only for biscuits with a vanilla cream filling. Just like an Oreo.

Also, if you look at similarities as opposed to all the things that are dissimilar, you’ll see that all the differences that Parle pointed out were minor. Sure, the Parle logo was prominent. But that’s not enough. Because a person of average intelligence need not be aware that Parle and Cadbury are two distinct companies.

Now Parle tried one more angle. It argued that other vanilla cream biscuits come in blue packaging too. So it can’t be penalised.

But again, the Judge didn’t think much of that argument. Just because others have copied a similar packaging, doesn’t mean that Parle can go scot-free. The others could’ve seen Oreo’s success and copied it too. And you can’t expect Oreo to sue everyone, right? It takes time. It takes money. And it’s really dependent on Oreo to decide which is worth going after.

So Parle lost out on this front too.

And finally, what about the design of the biscuit itself?

Well, that’s the only place that Parle scored a point.

Because sure, both biscuits have a bunch of intricate patterns on the surface. And Oreo has a trademark over its design. But apart from a ridge running along the circumference of the biscuit and a few dashes, the design is quite different.

And if we want to establish design infringement, you really need the marks to be the same. Feature for feature.

But wait…what about the concept of ‘passing off’ — Where you coyly use a similar design to confuse a customer?

Well, if the biscuits were individually out in the open, side by side, you could’ve said that Parle was trying to pass off its Fab!O as an Oreo. The designs could look similar. But, the biscuits are in a pack. It’s not sold loose in the stores. So you really don’t expect someone to get confused by the design, right?

So yeah, it’s 2–1 to Oreo in this round.

And the end result?

Well, you’re not likely to see the FAB!O biscuits in their blue packaging for a while. Parle can’t use the brand name or the packaging for a new batch of these biscuits.

Anyway, you can be sure this is not the last we hear about this battle. And we’ll see what happens in round 2.

Until then…

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