A2 Milk (ASX:A2M) share price lifts amid trademark stoush

The Kiwi dairy share was climbing higher on a bleak day for ASX 200 shares

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The A2 Milk Company Ltd (ASX: A2M) share price has edged higher on Thursday as a trademark battle with Nestlé rages on.

A2 Milk share price lifts amid trademark stoush

Shares in the Kiwi dairy group closed 0.46% higher following media coverage of the ongoing battle for the A2 trademark.

According to an article in The Australian, A2 Milk is “stepping up its fight” with Nestlé. A2 Milk is reportedly appealing a decision from the Australian Trademarks Office to side with Nestlé over its own infant formula range containing the A2 protein.

A2 Milk’s initial challenge was rejected by the trademarks office after stating that it “failed to establish any grounds of opposition”.

The Kiwi dairy group, known for vigorously defending its intellectual property, has appealed the decision. It’s the latest legal battle that has drawn A2 in as it fights to protect its signature branding around the world.

One of the fundamentals at the root of these lawsuits is the chemistry of milk. Cow’s milk contains both the A1 and A2 beta casein proteins. However, A2 Milk removes the A1 protein to create its line of products.

According to the article, A2 Milk commented the following in its defence against Nestlé:

“This decision is based on scientific research that suggests that milk that is free from A1 protein has been associated with reduced symptoms in individuals who are dairy sensitive.”

It comes as Nestlé is rumoured to be considering a takeover of A2 Milk following its FY21 results release next week. The A2 Milk share price has plummeted 43.3% in 2021 as flagging China sales have weighed on earnings guidance.

Foolish takeaway

The A2 Milk share price edged higher on Thursday despite broader weakness in the S&P/ASX 200 Index (ASX: XJO). The benchmark Aussie index closed the day down 0.50% at 7,464.60 points.

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended A2 Milk. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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