The Canadian Food Inspection Agency claimed the win for official Ottawa as per a ruling handed down by Justice Robert Mainville, who dismissed Kraft and Saputo's joint appeal and awarded costs to the government.
Specifically, the new regulations require that cheese imported into Canada or produced in Canada and marketed in international trade or enter provincial trade must have:
a. a certain percentage of casein content derived from liquid milks, and not from other milk products such as weight cream or milk powder (the "Casein Ratios"); and
b. a whey protein to casein ratio that does not exceed the ratio of whey protein to casein ratio of milk (the "Whey Ratio").
Kraft Canada and Saputo argued the essential or dominant purpose of the regulation amounted to an economic transfer in favor of dairy producers to the detriment of dairy processors by requiring the use of additional liquid milk in the production of cheese which would result in "substantial impact on milk supply cost for dairy processors."
The lead witness for the processors in testimony given in 2008 to the House of Commons Standing Committee on Agriculture and Agri-Food, stated, "so we've been able, through the use of technology, to reintroduce the whey protein concentrate into cheesemaking to the benefit of the industry. It reduces cost, and there are more efficiencies, and so on."
The courts factual findings “seriously undermine the appellant's assertions.” The court found that the regulations, "address consumer expectations and interest as to the composition of cheese."
In addressing consumer expectations the court relied on the testimony of a Mr.Wathier, and experience Master Cheese Maker and cheese Judge:
Mr. Wathier, a Master Cheese Maker at St. Albert with four decades of experience in the industry, including experience as a cheese Judge and as a consultant to the applicant Parlamat, gave evidence concerning the impact of using milk derivatives on cheese quality. His evidence was that even small quantities of milk derivatives (up to 5%) could affect the taste, texture, and consistency of cheese compared to cheese made with fresh milk. The process of converting fresh liquid milk into a powdered milk derivative has an immediate impact on the taste, which is one of the reasons why, for example, consumers gravitate away from skim milk powder."
Although America has cheesemaking standards which prohibit the addition of various yield enhancing technologies, America has steadily suffered from what can be described as regulatory drift.