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Call your sparkling wine champagne these days and you'll have a French lawyer on your back faster than you can say "sacre bleu".

But when a family-run vineyard in Nelson called its chardonnay Kiwi White and exported it to Sweden, a French company threatened it with legal action, saying it had already trademarked the term Kiwi.

The Lacheteau wine company registered the name "Kiwi Cuvee" and is prepared to sue anyone, including New Zealanders, for selling wines with the same name anywhere in the European Union.

Greg Day, founder of Kahurangi Estate, said he would no longer sell his wines in Sweden even though his first shipment of 1100 cases of chardonnay sold in two months.

He was set to negotiate a larger contract when the French wine company served its cease and desist order.

"It's a case of the pot calling the kettle black. Here's the French trying to protect Burgundy as a geographical indicator and saying we can't use Kiwi. We can't use something that is an icon," said Day.

He said he couldn't afford the legal costs to fight the French company, even though his brand was selling in Europe before the term was officially registered.

The French winemaker has been making the Kiwi Cuvee brand since at least 2000, but trademarked the name in May this year.

Local winemakers say the French company is trying to trade on New Zealand's fine reputation as a maker of sauvignon blanc.