Intellectual Property Legalities on food and beverage industry explained

15 Apr 2022

The UAE is characterized as a significant producer of the oil and gas industry in the World. The Food and Beverage industry is viewed as the second largest industry at an international level. This sector has risen by 22%, holding a value of $13.2 billion by 2018. The UAE Food and Beverage domestic market is anticipated to hold a worth of 131 billion and 14 billion, which means a growth of almost 62% compared to the present value. Dubai has considered Food and Beverage as one of the beleaguered sectors in the Dubai Industrial Strategy 2030. High population with higher disposable income, continuous growing demand for food services, Gulfood 2019 and Expo 2020 are the core drivers that have thrived the food and beverage industry to the next extent in the UAE.

The food and beverage industry invests in innovation and research to produce items with the requisite mouthfeel, taste, appearance, and nutritional value simultaneously as concurrently controlling production costs. Furthermore, there is the additional pressure of changing consumer tendencies, such as the rise in vegetarianism, veganism, alcohol-free drinks, and healthier versions of comfort foods, while meeting new legislative policies and requirements. The capacity to meet such conditions can provide businesses with a competitive advantage. The question then is how can they preserve this advantage, and how can they stop competitors from earning the rewards of their research and investment? In the Food and Beverage industry, there are two (2) methods to protect intellectual property: trade secrets and patents.


Trade secrets:

Trade secrets are intellectual property rights (IPRs) on secret information which may be sold or licensed. To be suitable as a trade secret, the data must be:

  • Commercially appreciated because it is secret;
  • Be subject to rational steps taken by the legal holder of the material to keep it secret; and
  • Be recognized only to a limited group of individuals.


Patents in Food & beverage industry:

On the other hand, a patent is a limited right approved for an invention, which is a creation or a process that delivers, in general, an original way of doing something or offers a novel technical answer to a problem. To obtain a patent, first, approach a legal agent who is well experienced in IP protocols. The first thing that they will suggest is that the practical information about the invention must be disclosed to the public in a patent application. Patent protection means that the creation cannot be commercially made, used, distributed, imported, or sold by others without the patent owner’s consent.

For the UAE, every consumer has the right to safety and freedom of food for consumption. The UAE President approved the law on food protection in 2016, which emphasizes establishing the standards and regulations to ensure safety and quality food. The UAE regulates the food industry through intellectual property in commercial food production. Intellectual property includes manufacturing procedures, ingredients used, branding of products, etc. We can find Federal Law Number 31 of 2006 concerning the Industrial Regulation and Protection of Patents, Industrial Drawings, and Designs. Article 4 lays down that a letter’s patent must be granted to any new invention subsequent from an innovative idea or inventive step in all fields of technology, provided that such an idea or inventive step has a scientific basis and is proficient in industrial application. The invention must be estimated industrially applicable in its most extensive-term or utilized in agriculture, fisheries, handicrafts, and services. The application shall be controlled to one invention only or a group of interrelated innovations yielding one general innovative concept. Suppose it is evident after the issuance of the letters patent that the condition of interrelationship has not been met following the statement mentioned above. In that case, such a piece of evidence shall not negate the patent.

Furthermore, article 5 stated that a utility certificate might be delivered for new creations capable of industrial application but having no innovative character demanding patentability. Under the demand of the inventor or his legal representative, the utility certificate must also be supplied for the invention satisfying the conditions provided for in article (4).

Nevertheless, to the following objects, no letters patent or utility certificate shall be issued (article 5):

  • Biological methods of producing plants or animals, animal species, plant varieties. Exceptions must be permitted for the microbiological methods and their products.
  • Treatments, diagnostic methods, and surgical operations are needed for humans and animals.
  • Scientific and Mathematical principles, discoveries, and methods.
  • Guides, rules, or methods followed in conducting business or performing mental activities, or playing games.
  • An invention that may lead to the destruction of the public order or morals.

An important question that companies have to ask is how to protect the intangible assets of your product? How to prevent competitors from copying your intellectual assets, know-how, and work? The food and drink industry shall pay particular attention to the trademarks, patents, and designs they own because the competitors will not wait for too long and will start copying the best-selling products. For example, Nestle is a big company, and it is a leader in the food sector, with 96 % of its business in food and drink. In 2000, Nestle carried out a significant review and overhaul of its Intellectual Property management structures. Nestlé achieves research and development worldwide, but the parent business owns all the company’s Intellectual Property (IP), which it licenses out to its subdivisions. Before the renovation of the IP department, 55 lawyers around the World were involved in trademark issues. All 55 made recommendations distinctly to the IP attorneys back in headquarters on how things should be done nationally or globally. The business now has 16 regionally based IP advisors reporting to the office, which form part of a single team. The IP Department also revised its mission declaration. This focuses on the central corporate goal of the company’s IP-related activity: “To generate competitive advantage through the progress of Intellectual Property rights.” All choices as to which products to protect, how, and where the flow from this.


Case studies:


Case study1: 

An example that shows how much intellectual property rights can be valued is “Coca-Cola” company. In 2001 Coca-Cola trademark was valued at $68.9 billion (in 2018, brand – $ 57.3 billion). Equally, Pepsi’s brand value was $18.4 billion in 2018, ranking in the 20 most valuable brands in the World. The food and drink industry understands the brand’s value and seeks to protect intellectual property generated within. The most valuable aspect of the legal conservation of your intellectual property is that it turns invisible assets into individual property rights. It lets you claim possession over your company’s intangible assets and exploit them to their maximum potential. In short, IP protection makes intangible assets a bit more tangible by turning them into valuable, exclusive assets.


Case study2: 

Another study case is coffee in Ethiopia. Coffee generates approximately 60% of Ethiopia’s total export earnings, and an approximate 15 million persons are directly or indirectly involved in the Ethiopian coffee industry. The finest coffees, such as Sidamo, Yirgacheffee, and Harar originate in Ethiopia. They have a unique aroma and flavor that distinguish them from coffees of other countries, nevertheless, only 5%-10% of the retail price goes back to Ethiopia, and many coffee growers earn less than a dollar a day, sometimes farmers abandoned coffee production due to low returns and involved in growing more lucrative narcotic plants. 

For these reasons, the Ethiopian government is trying to use a range of Intellectual Property Rights (IPRs) to distinguish their coffee in the industry and accomplish higher returns. The government created the Ethiopian Coffee Trademarking and Licensing Initiative in 2004 to make available a real solution to overcome the longstanding divide between what coffee farmers obtain for a pack of their beans and what exporters charge for that coffee when they sell it in retail outlets in different countries. This initiative is organized and run by the Ethiopian Fine Coffee Stakeholder Committee, including private exporters, cooperatives, and the Ethiopian Intellectual Property Office (EIPO). The government of Ethiopia decided that in its place of trying to keep Ethiopian coffee’s geographical origin, it would be better to keep its commercial origin, which it would do concluded registering trademarks. This was understood as a more direct way of protection because it would grant the government of Ethiopia the lawful right to exploit, license, and use the trademarked designations about coffee goods to the exclusion of all other buyers. The EIPO began filing requests to register Harar, Sidamo, and Yirgacheffee as trademarks in essential markets. In the United States, Yirgacheffee was the first to acquire registration. In 2006, the trademark strategy for Ethiopian coffee faced significant trouble. The USPTO- the United States Patent and Trademark Office- had accepted the request to register Yirgacheffee. But the NCA (National Coffee Association), representing coffee roasters of the USA, objected to the EIPO’s applications to trademark first Harar, then Sidamo. In both cases, the grounds for disapproval were that the names had become too generic a description of coffee as such were not qualified for registration under the United States trademark law. The USPTO refused the application for Harar in 2005 and Sidamo in 2006.

The American coffee chain Starbucks Coffee Corporation, which was extensively stated in the media to have been a driving power behind the NCA opposition, openly offered to support the EIPO in emplacing a national system of certification marks to allow the farmers to keep and market their coffee as “strong” geographical indications. “These systems are distant more effective than registration trademarks for geographically descriptive terms, which is essentially contrary to general trademark law and customs,” said the company in a declaration. But the EIPO and its counselors disagreed. The designations, they noted, referred not to geographical locations but distinctive coffee types. Besides, suitable intellectual property (IP) tools must be chosen to meet specific needs and situations. “You have to comprehend the circumstances in Ethiopia,” Mr. Mengistie of EIPO explained. “Our coffee is grown on four (4) million tiny plots of land. Positioning a certification system would have been unviable and too expensive. Trademarking was more suitable for our requirements. It was a more direct way offering more control.” The EIPO filed refutations against the USPTO verdicts with supportive evidence to prove that Harar and Sidamo’s terms had attained uniqueness. In the meantime, both Starbucks and the Ethiopian government were strong to resolve their differences rapidly and find a flexible way forward. Their shared efforts led to an announcement in 2006 that they had reached a mutually satisfactory agreement regarding the distribution, marketing, and licensing of Ethiopia’s specialty coffee designations, which provided a framework for cooperation to indorse recognition of Harar, Sidamo, and Yirgacheffee.

Starbucks decided to sign voluntary trademark licensing agreements that instantly admit Ethiopia’s ownership of the Harar, Sidamo, and Yirgacheffee names, regardless of whether a trademark registration was approved. In August 2006, the USPTO updated the EIPO that their refutation in the case of Harar had been successful. A trademark for Sidamo was also decided in February 2008.


Case study3:

Another study case is Rooibos Tea in South Africa (SA); this tea is a vital economic resource for farmers and processors in SA for generations. The IP dispute adjacent to the registration of rooibos as a trademark in the USA carried international attention not only to the unique benefices of the plant but also its link to the culture of the society in the Cederberg region and South Africa. This inspired the industry to unite around a mutual cause for the protection of rooibos. In conclusion, in 2014, rooibos received status as the first geographical indication (GI) for a South African product other than wine and spirits. Separately from the prosperous tea industry, rooibos has many different uses, one of the most common being rooibos in make-ups and skincare.

Ms. Theron was the pioneer of using rooibos in cosmetics and skincare, and she created a company named Forever Young and a line of rooibos-infused health and skincare products. Forever Young’s products became very common in North America and Europe and created an increased demand for all things rooibos. As a result of the triumph of her products, Ms. Theron filed a trademark request for the term “Rooibos” – as it relates to using in skincare goods – in 1993 with USPTO. It was listed in 1994, and when Rooibos Limited perceived this, the enterprise was unquiet that the trademark of the term rooibos by one corporation might harm other companies entering the US market. With the assistance of the SA government, Rooibos Limited complained to the registration by Forever Young, quarreling that it was not valid because “rooibos” is a generic word and consequently cannot be controlled by any one entity.

Ms. Theron pensioned in 2001. When she did, she vended the trademark for the US $10 to her representative in the USA (Ms. Virginia Burke-Watkins, of Burke International). Throughout her business, Ms. Burke-Watkins then started sending “cease and desist” letters to several small tea cafés and Internet resellers. The letters informed such entities that their use of the “Rooibos” name infringed on her trademark. As a result, they were obligated to pay Ms. Burke-Watkins US $5,000 in reward. Demands were even completed to South African companies. Many of these minor enterprises tried to get around the trademark by calling their goods “Red Tea” or “Red Bush,” but this carried a great deal of confusion to consumers. From little cafés to larger enterprises like Rooibos Limited, other companies fought back and argued to cancel the “Rooibos” trademark.

In 2002, to market its goods in the USA, Rooibos Limited filed a trademark request with the USPTO for “Rooibos the Red Tea.” But, because the trademark comprised the term “rooibos,” it was also subject to dispute from Burke International. For the sake of the rooibos business as an entire, and with the media on their side and growing support from the tea industry, Rooibos Limited decided to continue to pursue its legal battle with Burke International.

While litigation continued, Wupperthal Cooperative, representing smallholder farmers, got involved and the media noticed. Cooperative farmers were suffering the same challenges exporting their rooibos to the USA because they kept running into legal obstacles based on trademark registering. Burke International limited the use of the term “rooibos” to only those companies that were ready to go in for a business relationship with Ms. Burke-Watkins. This prerequisite would have tied farmers (both smallholder and commercial) into trade relationships that were not fairly negotiated and possibly detrimental. Following the publicity this generated, several major coffee houses and retailers in the USA threw their support behind Rooibos Limited. This destructive name registration issue was threatening the livelihood of all rooibos farmers, and we had to do something about it. In 2005, after ten (10) years of disagreement and nearly US $1 million in legal charges, the two (2) companies settled. Both companies by choice and categorically agreed to cancel their trademark registrations on the exclusive right to the word “rooibos” in the United States and other states. This settlement meant that the word “rooibos” became a generic term in the USA and consequently part of the public domain, unrestrained for anyone to use.


Case study4:

Another study case is about Industrial Liquori Affini Roma (ILAR), a family-owned company headquartered in Rome. Its activities include producing and distributing a wide range of spirits and fruit syrups and importing and distributing spirits on the Italian market. The company’s leading brand is Pallini®. ILAR distinguishes the value of its intellectual property (IP) rights and contemplates them as vital to guard its goods and brands. National and international trademark registrations are essential for commercial diffusion and maintaining a high standard of exclusiveness everywhere.

Sometimes, the firm uses industrial design registrations to keep certain design features of the bottles (labels, accessories, and packaging). ILAR has always been proactive in protecting its intellectual property rights. Some years ago, it sued a rival Italian firm that copied the bottle’s design of their “Mistrà Pallini” liqueur. It gained the case and was awarded substantial damages against the counterfeiter.


Case study5:

In Fargo Mercantile Co. vs. Brechet & Richter Co., 295 F. 823 (8th Cir. 1924). The complainant, a producer of fruit nectar, assumed that the respondent infringed the plaintiff’s copyright. At issue was a label the complainant put on its bottles of fruit nectars. There were two parts to the brand: recipes and an emblem. The recipes contained comprehensive directions for making particular food and drinks. The symbol was colorful and included the plaintiff’s name and additional publicity material. The accuser copyrighted the whole label and alleged the respondent infringed the brand and violated the Copyright Act. In estimating the petitioner’s claim, the court studied the recipes and emblem distinctly. Concerning the recipes, the court specified, “they are original compositions, and serve a valuable purpose….”. Exactly, they served to “advance culinary art.” Prominently, the court stated that “if printed on a single page, or as a booklet, these recipes could certainly be copyrighted, and we see no purpose why this protection should be denied, simply because they are printed and used as a label.” The Eighth Circuit detained the recipe was copyrightable as an “original work of authorship.” Particularly, the court did not address the justification that the recipe was just a genuine declamation of a “process” that would not be copyrightable.

Fargo stands for the scheme that recipes are copyrightable as “original works of authorship.” The law court in Fargo, unlike future courts, did not study whether the recipe had extra commentary or required the same to be copyrightable. In lieu, the court detained those recipes that are copyrightable. Consequently, under Fargo, recipes that only include a list of ingredients with simple instructions appear to be protected by the Copyright Act.


Case study6:

In Publications Intern. Ltd. vs. Meredith Corp., the law court addressed whether copyright laws provide protection to recipes that are in a cookbook where the cookbook has compilation copyright. 88 F. 3d 473 (7th Cir. 1996). There, both the accuser and the respondent published magazines and books with recipes in them. Meredith printed a cookbook titled Discover Dannon–50 Fabulous Recipes with Yogurt, and the business obtained a copyright for the recipe book as a “collective work.”. In the copyright application, the respondent defined the subject matter as a “compilation” of “recipes tested with Dannon yogurt.” Meredith alleged that Publications International produced twelve publications comprising recipes from the Discover Dannon cookbook that infringed on its copyright. Meredith claimed its collective work copyright extended to the individual recipes within the cookbook. The court observed at the language of the Copyright Act of 1976, which needs that copyrightable work “possess some minimum indicia of originality, that they are original intellectual conceptions of the author.” Section 102(a) comprises literary works (for example, cookbooks), while Section 102(b) excludes things such as processes, systems, and methods of operation (for example, recipes).

Compilation copyright defends the order and manner of presenting the compilation’s elements (for example, the order of recipes in the cookbook), but not automatically the individual components (for example, the specific recipes). In this case, the recipes were found to be lists of needed ingredients and directions for combining them to attain the last result. They did not have “expressive elaboration upon either of these functional components”. At its center, the court found the ingredient parts to be statements of facts. Such functional listing was not authentic within the definition of the Copyright Act.

Regarding the directions, those were ruled out under Section 102(b) as nothing more than the “process” for preparing the dish, which is something that is expressly excluded from copyright protection. The court specified that there could be no monopoly on the method that someone might use to prepare and combine the necessary ingredients. In other words, a basic recipe without literary expression is not copyrightable. The court detained open the interrogation of whether specific recipes might be copyrightable, even so, such as “plates with musings about the spiritual nature of culinary…suggestions for presentations, advice on wines to go with the meal…”

Just two years later, the Sixth Circuit also studied this issue and went even further than Publications in limiting the capacity to copyright recipes.


Case study7:

In Lambing vs. Godiva, the accuser claimed that Godiva misappropriated her proprietary rights in her recipe and design of a chocolate truffle. 142 F. 3d 434 (6th Cir. 1998). The accuser argued Godiva violated her copyright by making and vending a truffle defined in one of her recipes contained in a not published cookbook. In an idea with little analysis, the court specified that “Recipes…are not copyrightable” and “the identification of ingredients essential for food preparation is a declaration of facts. There is no sensitive component deserving copyright protection in each listing.”. Therefore, the court detained that “recipes are functional directions for achieving a result” and are excluded from copyright protection.

Different Publications, the Lambing court ignores the possibility that there could be sufficient expressive components in a recipe that might make it protectable. In the case of Publications, the court found no such graphic basics were in the recipes in that situation. In Lambing, the law court did not even entertain such potentials. It just started, “Recipes…are not copyrightable.” Lambing, 142 F. 3d at 434. This field is much thinner than the holdings in Fargo or Publications. Somebody could claim that a circuit split exists on the issue of whether recipes are copyrightable. The Eighth Circuit has detained that a recipe is copyrightable; the Sixth Circuit has held that a recipe is not copyrightable. The Seventh Circuit has confined that a recipe is not copyrightable if it is an available list. Still, it left open whether a recipe can be copyrightable if it contains musings, suggestions, or advice.