TUF hit with $4.5m trade-secrets theft verdict in US
Written by changthai11 on Tuesday, October 7th, 2008
SEAFOOD
TUF hit with $4.5m trade-secrets theft verdict in US
Thai Union Frozen Products Plc (TUF) and two of its units have been ordered to pay a US food company $4.5 million plus legal fees in a trade-secrets case. Contessa Premium Foods Inc sued two of its former employees and TUF for trade-secret theft in California state court in Los Angeles in February 2006.
Globally, TUF’s tuna-canning business is second in size only to that of San Francisco-based Del Monte Foods Co.
The court found that Bryan Rosenberg, TUF’s former managing director of sales, and Brenden Beck, the former regional sales manager for retail for TUF, used Contessa sales calls to sell frozen food products made by competing companies.
They were also accused of using Contessa resources to develop design, products, promotional materials, marketing strategies and sales presentations for competitors.
TUF ”aided and abetted the misappropriation of Contessa’s trade secrets” by the two executives, said court papers.
The jury verdict, handed down in Los Angeles on Sept 26, included $200,000 in punitive damages relating to Mr Rosenberg’s conduct, and $1.5 million in punitive damages that TUF must pay. Jurors also awarded Contessa $2,788,183 in actual damages.
TUF president Thiraphong Chansiri said yesterday the company respected the ruling, declining to comment further.
In a related development, TUF yesterday announced it was buying shares of Avanti Feeds Limited (AFL), India’s second largest shrimp feed manufacturer, for approximately 40 million baht.
After the investment, TUF will own a 14.99% stake in AFL, which is listed on the Bombay Stock Exchange.
The investment was helped by the long-term ties between TUF’s subsidiary Thai Union Feedmill (TFM) and Avanti. TFM specialises in producing and distributing feed products for shrimp and fish in Thailand. It has been supporting Avanti with its technical expertise in feed production for black-tiger shrimp over last few years.
In the past, the Indian government has allowed only local farmers to raise black tiger shrimp. However, it has recently allowed white shrimp farming to help increase overall production and exports. TUF expects strong growth in shrimp production in India as a result of the change in policy.
TUF also said it plans to sell two billion baht worth of bonds this year. The bond sales, with maturities of up to five years, ”will help us balance short-term borrowings with longer ones”, said financial controller Wai Yat Paco Lee.
TUF had short-term borrowings of 8.79 billion baht, compared with 4.74 billion in long-term debt, on June 30.
TUF shares closed yesterday on the SET at 19.60 baht, down 40 satang, in trade worth 16.39 million baht.
