Earlier this month, the Finnish Market Court ruled Arla Foods may no longer use the term 'Skyr' to market or sell products in Finland.
In the October 6 ruling, Arla was ordered to remove its Skyr from Finnish shelves by the end of the week.
Any violations of the Market Court ruling are punishable by a fine of €500,000.
The Finnish Market Court found in favour of Icelandic dairy cooperative, Mjólkursamsalan (MS Iceland Dairies), which sells Skyr in a number of markets, including Iceland, Finland, Sweden, Norway and Denmark.
It argued that 'Skyr' is a trademark it owns, and not a generic product name.
"The Swedish dairy company Arla is no longer allowed to sell dairy products under the name ‘Skyr’ in Finland. The Swedish company has been selling products labelled Skyr in Finland for some time, marketing them as ‘the Icelandic super yogurt’,” MS Iceland Dairies said in a statement.
“A Finnish court has agreed with the Icelandic dairy MC that ‘Skyr’ is not generic product type but a trademark owned by MS.”
Speaking with DairyReporter, Outi Fagerlund, communications director, Arla Finland, said the company shocked by the Market Court ruling.
"We were surprised by the decision because Skyr is a generic term and in other countries the product is sold by different producers," she said.
The company - formerly Arla Ingman - is yet to decide whether it will appeal the ruling, Fagerlund added.
"We haven’t made a decision yet," she said. "Our lawyers are going through the decision. Then we’ll decide what to do."