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Arnott's and Unilever are engaged in a legal stoush over a Streets Blue Ribbon mint slice ice cream launch.

The biscuit maker has launched Federal Court action against the company after a dessert deal they had agreed on fell flat.

Arnott's is attempting to stop Streets from selling the ice cream, alleging the new product will mislead shoppers into thinking it contains Arnott's Mint Slices, according to The Sydney Morning Herald.

It is alleged that Streets, owned by Unilever, and Arnott's struck deals in 2004 and 2008 to develop ice cream products together.

This agreement resulted in such flavours as Blue Ribbon ice cream mixed with Tim Tams, and Cornetto cones embedded with Arnott's Mint Slice.

The Australian Financial Review reported they made another deal in 2014 to collaborate on new products and signed a confidentiality agreement.

Arnott's said it then shared biscuit secrets with Streets, including recipes and supplier details. However, the two companies had stopped discussing collaborations by 2015.

Arnott's said it was shocked in June this year to discover Streets proposed to launch Blue Ribbon Mint Slice ice cream in supermarkets.

The AFR reported the biscuit giant wanted the court to stop Streets from selling or promoting any ice cream with the words "mint slice", and to order payment for damages for loss of reputation and goodwill.

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