US food manufacturer and co-packer Don Lee Farms has claimed “the facts are clearly on our side” after fresh developments in its legal battle with one-time customer Beyond Meat.
A judge has ruled Don Lee Farms has proved the probable validity of its claim that Beyond Meat breached a manufacturing agreement between the two companies.
In a separate motion before a different judge, Don Lee Farms’ request to name Beyond Meat CFO Mark Nelson, senior quality assurance manager Jessica Quetsch and director of operations Anthony Miller in its fraud claims has been granted.
In 2016, Don Lee Farms exclusively manufactured the Beyond Burger for Beyond Meat in 2016. A year later, Beyond Meat “walked away from the agreement” and moved “production and processes developed by Don Lee Farms under the agreement to other food manufacturers”, Don Lee Farms claims.
Don Lee Farms claimed during the time the companies worked together it raised “significant concerns regarding inadequate food safety protocols for raw materials produced at Beyond Meat’s facility, after receiving adulterated product to be used to make consumer items for Beyond Meat”.
For its part, Beyond Meat has criticised Don Lee Farms’ own record on safety, insisted it plans to show it was “justified” in firing the co-packer and dismissed its former partner’s claims as “meritless”.
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Don Lee Farms alleges the three Beyond Meat executives intentionally doctored and omitted material information from a food safety consultant’s report and claimed it was the consultant’s opinion. The omitted portions discussed significant food safety issues at Beyond Meat’s facility, Don Lee Farms claims.
In a statement, Beyond Meat, being sued for fraud, negligence and breach of contract, insisted it is “well-known for its rigorous product standards”.
The company said: “That is why Beyond Meat stopped working with Don Lee Farms in 2017. Beyond Meat simply couldn’t get Don Lee Farms to meet its standards, no matter how many times it tried. Rather than risk the industry learning of their repeated safety shortcomings, Don Lee Farms sought to change the narrative by filing a baseless lawsuit against Beyond Meat.
Beyond Meat added: “Beyond Meat denied each of Don Lee Farms’ claims and counter-sued for Don Lee Farms’ material breach of contract in failing to meet safety standards.
“Don Lee Farms has now doubled down in its campaign of disinformation by claiming the court had somehow ruled that Beyond Meat will be shown to have breached its contract with Don Lee Farms. This claim would be laughable but for the fact that some media decided to report this obvious falsehood as fact.
“In reality, the actual court deciding this dispute made no such ruling. Rather, a writs judge – not the trial judge – in a separate undertaking in another court said Beyond Meat should set aside some money should Don Lee Farms somehow prove that it did not receive a small payment on a handful of invoices. This typical pre-judgment provisional remedy is common in any claimed breach of contract matter to make sure there is money available if necessary after trial. It is nothing more.”
Beyond Meat argued Don Lee Farms’ move to add three executives to the lawsuit “serves no legitimate purpose”.
It argued: “Here, Don Lee Farms did nothing more than add the names of the specific Beyond Meat employees that it claims worked on a challenged safety audit report; otherwise, Don Lee Farms did not substantively change their claims in any way.
“More pointedly, the audit report about Beyond Meats’ safety efforts has absolutely nothing to do with the decision to terminate Don Lee Farms because of their inability to meet Beyond Meats’ rigorous product quality standards. Like the original lawsuit itself, the addition of individual Beyond Meat employees to this dispute serves no legitimate purpose.
“Rather, this latest legal gambit is nothing more than a ploy to harass these hard-working, dedicated individuals. Beyond Meat stands behind our employees and we remain committed to defending them and our company.
“Beyond Meat fully intends to show at trial that it was justified in firing Don Lee Farms due to its repeated safety violations and Don Lee Farms’ lawsuit is meritless.”
At the time of writing, Don Lee Farms had not responded to a request for a reaction to Beyond Meat’s claims.