Financial Mail and Business Day

Clover wins the butter battle

Katharine Child Retail Correspondent childk@businesslive.co.za

Stork, which is part of holding company Remgro’s Siqalo Foods, has seven days to stop selling its butter spread in its current packaging, after the Supreme Court of Appeal found the label is likely designed to mislead the public.

Stork, which is part of holding company Remgro’s Siqalo Foods, has seven days to stop selling its butter spread in its current packaging, after the Supreme Court of Appeal found the label is likely designed to mislead the public into thinking the product is made of pure butter.

Stork’s butter spread is made of 38% butter, with 30% vegetable oil and is referred to in the Agricultural Product Standards Act regulations as “modified butter”.

Competitor Clover, which has produced modified butter spread Butro since 1985, approached the court in March 2021 with a complaint that Stork was marketing its product as a pure butter product unlawfully and in a misleading fashion.

It tried to get an urgent interdict to stop Stork from selling its spread, saying it was “competing unlawfully” in part because the label contravened at least two statutory regulations.

Clover failed to have the case heard urgently, but it was heard in the North Gauteng High Court later in 2021. In November of that year, a judge ordered Stork to stop selling the product in the current packaging.

Siqalo, which produces the Flora, Stork, Rama and Rondo brands, was purchased by Remgro from Unilever in 2017.

Siqalo appealed the high court judgment.

The Supreme Court of Appeal, however, said on Wednesday the Stork “butter spread” label was likely designed to deceive customers into thinking the were buying a predominantly butter product.

The biggest word on the label is “butter” and legally it cannot be bigger than the product designation, which is modified butter, said Hahn & Hahn lawyer Janusz Luterek, who acted for Clover.

The court found that the line “medium fat modified butter spread” was “barely perceptible”.

The judgment read: “As observed earlier, the word butter is undeniably the dominant feature on the appellant product label. It follows that the conclusion [that the] label is likely to create a misleading impression ... is inescapable.”

The court also found Clover’s decision to try to get an interdict against the sale of the product was appropriate, despite Stork arguing it should have written to the minister of agriculture instead. The court ruled that the minister of agriculture did not need to be included in the court case as Stork had argued.

Both the Agricultural Product Standards Act and the Consumer Protection Act have regulations that prohibit misleading labels. However, it is more common for competitors to take action to enforce the law than for environmental health practitioners, who are employed by municipalities, to do so.

Siqalo had not responded to requests for comment at the time of publication.

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2023-06-01T07:00:00.0000000Z

2023-06-01T07:00:00.0000000Z

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