Friday 28 October 2016

Rival food firm misused secret Kerry Group data, court rules

Published 13/10/2016 | 02:30

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Icelandic food group Bakkavor misused confidential information secured from Irish food giant Kerry to pursue the development of its own range of high-value infused oil products, an English court has ruled.

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And the Irish company has claimed Bakkavor's actions could even threaten the viability of one of Kerry's UK plants.

Codenamed 'Project Aequo', Bakkavor spent years trying to mimic Kerry's products before the Irish group learned of the plan.

A British court has granted a year-long injunction against Bakkavor to prevent it undertaking the manufacture of its own infused oil product line.

For a number of years, a UK company called SpringThyme had sold infused oils to clients including Bakkavor.

Kerry acquired SpringThyme in 2010. It now makes more than 30 infused oils at its Padiham plant in Burnley.

The oils are infused with ingredients such as mint, chilli, garlic and rosemary and can be added to salads or pizzas or used as an ingredient in the manufacture of ready-meals.

Bakkavor continued to buy infused oils from Kerry after the Irish group acquired SpringThyme.

But in 2015, the site manager of the factory in Padiham learned that a German firm had been working with another food group to help it develop infused oils.

During a meeting with the German company, the Padiham site manager was shown documentation related to that work, which included information he regarded as being confidential to Kerry.

The court heard that a senior Kerry executive, Barry Synnott, then arranged to meet Bakkavor executive Richard Briers.

Mr Briers confirmed during that meeting that Bakkavor was going to manufacture its own infused oils and would stop buying such products from Kerry early in 2016.

Bakkavor had initially pursued the development of its own infused oils in 2010. But the manufacturing and development process was complex and the project was put on hold until 2012.

By 2014, the Iceland-headquartered company, which is domiciled in the UK, had further advanced its project.

It commissioned a full feasibility study and then started a tender process.

That invitation to tender included Kerry's specifications for chilli and basil oil, and a flow diagram of the proposed manufacturing process.

Installation of the equipment necessary to produce the infused oils was completed at a Bakkavor plant in the UK last October.

An initial injunction was granted to Kerry against Bakkavor in December last year.

Kerry insisted that any information regarding the manufacturing process was only given to Bakkavor for safety and regulatory purposes.

The judge hearing the case said that "any reasonable person" should have realised that the information "was not to be used for Bakkavor's own product development".

He said Bakkavor had obtained a "head start" through the improper use of confidential information.

He assessed that head start to be a year in duration and has now granted an injunction against Bakkavor until June 2017 to prevent it from manufacturing its oils.

A spokeswoman for Bakkavor said: "Bakkavor acknowledges the court's judgement and confirms that this outcome will have no impact on Bakkavor's ongoing day to day operations. Bakkavor will continue with its plans to manufacture infused oils for commercial use from the end of June 2017."

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