Milklab maker Noumi sued after Europe deal sours
Milklab manufacturer Noumi is a step closer to closing the chapter on a long-running legal dispute with a former US supplier but faces a fresh lawsuit from French tea and coffee company Sunday Collab International over an alleged agreement to distribute Milklab in Europe.
At an extraordinary general meeting on Wednesday morning, the overwhelming majority of Noumi’s shareholders approved for the company to sell its 9.4 per cent stake in Australian Fresh Milk Holdings (AFMH) for $1.45 per share, or $29.6 million to pay off the remaining sum owed to US almond grower Blue Diamond.
Noumi shares are sharply lower on Wednesday. Credit:Janie Barrett/SMH
“Approximately $25 million of the proceeds from the sale will be allocated towards Noumi’s obligations under the settlement agreement … with the balance of $4.65 million to be used for general purposes including expenses related to the transaction,” said Noumi chair Genevieve Gregor.
Noumi’s shares have sunk by more than 7 per cent at mid-morning trading on Wednesday.
The dispute with Blue Diamond began in January 2020 over unpaid invoices. It escalated in September that year when Blue Diamond sued for fraud and breaching their licensing agreement by manufacturing nut-based beverages including Milklab and another brand, Australia’s Own.
Noumi (then known as Freedom Foods) responded by filing its own proceedings against Blue Diamond, arguing it hadn’t breached their licensing agreement, that Blue Diamond engaged in misleading and deceptive conduct, and was not acting in good faith.
The matter was eventually settled in January 2022 through US arbitration, after the Full Federal Court blocked Noumi’s attempt to have the matter thrown out of court.
Starting from September 1, 2022, Noumi will pay the $US18 million ($25.7 million) owed in quarterly instalments of $US1.125 million across four years.
While the Blue Diamond dispute comes to a close, Noumi still faces two class actions (which have been merged into one proceeding). A countersuit from former auditor Deloitte, and new legal proceedings from Sunday Collab International, which only came to light late last week.
2012 world surfing champion Joel Parkinson was part of Sunday Collab’s negotiating team that pitched Milklab’s expansion to Europe.Credit:Paul Harris
In a statement to The Sydney Morning Herald and The Age, French tea and coffee company Sunday Collab said its dispute with Noumi began in mid-2020 after it tried to enforce an agreement the pair had allegedly struck for the former to distribute Milklab throughout Europe.
Sunday Collab is seeking €17 million ($24.7 million) in compensation for costs incurred in launching the partnership throughout Europe in 2019, the company said, which it says Noumi participated in by delivering its Milklab range as well as marketing and packaging materials for product launches in Milan, Italy in October 2019 and the London Coffee Festival in early 2020.
“Unfortunately, following a management and board spill in August 2020, Noumi has repeatedly denied there is an agreement or any partnership in place, nor any obligation owed by Noumi,” Sunday Collab said in its statement.
Noumi also “refused to communicate” with Sunday Collab, the company alleges.
“Given this stance, coupled with the time and money we had already invested, there was little option but to bring the matter before the courts, which we did in March 2021.”
Noumi has said Sunday Collab’s claims are “without merit” and claims for lost profit are “wholly unsupportable”, and will defend the action.
Australian surfer Joel Parkinson was part of Sunday Collab’s negotiating team that pitched Milklab’s expansion to Europe.
“That this matter has ended up in court is extremely disappointing,” Parkinson said.
“Sunday Collab International has gone to court to recover the losses we have suffered as a result of Noumi’s conduct in walking away from the agreement and then refusing to communicate with us.”
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