French food conglomerate Group Danone SA yesterday asked the
boards of its joint ventures with Chinese partner Wahaha to file
lawsuits against its former chairman for what it said was his
breach of interests regarding the ventures, taking their
acrimonious dispute to a new level.
In a letter sent to the 39 joint ventures with Wahaha, Danone
said it had asked the boards to file lawsuits against Zong Qinghou,
the former chairman of the ventures.
The letter asserted Zong, without consent from the boards or
shareholders, had "directly or indirectly invested in and operated
several companies that were competing with the joint ventures".
Zong's actions, which Danone said were "aimed ultimately at
seeking economic gain had seriously encroached upon the interests
of the joint ventures and the interests of Danone as a
shareholder", the food company said in a statement.
Neither Wahaha, Danone's partner and China's largest beverage
maker, nor Zong were available for comment yesterday.
"In line with the relevant Chinese company laws, Group Danone
SA, in written form, officially asks the boards of the joint
ventures to file lawsuits with the courts against Zong Qinghou and
to seek civil compensation responsibility and to protect the
interests and rights of the joint ventures and shareholders," the
French firm said.
"If the boards of the joint ventures fail to take action against
Zong as required, Group Danone SA will officially launch relevant
legal procedures," it said.
The two beverage firms have been embroiled in a dispute over
their joint venture for more than three months.
Danone, which holds 51 percent of 39 joint ventures with Wahaha,
has already filed lawsuits in Sweden and the United States,
accusing Wahaha of breach of contract by using the Wahaha brand on
products sold outside the joint ventures.
Wahaha filed an arbitration claim last month seeking to
terminate the trademark-transfer agreement signed with the joint
ventures in 1996, claiming they never formally or legally
transferred the trademark from Wahaha Group.
Danone filed a counterclaim with an arbitrator in Hangzhou,
where Wahaha is based, rejecting Wahaha's statement.
Danone also said yesterday it had submitted materials to eight
local industry and commerce administrations across China alleging
four companies bearing Wahaha trademarks used falsified documents
to secure registration.
It said the four companies had used a counterfeited signature of
an American-Chinese to register their entities.
(China Daily July 20, 2007)
