French food group Danone Tuesday voiced displeasure and vowed to
appeal after losing its battle with Chinese beverage giant Wahaha
Group in a trademark dispute.
Danone said in Shanghai that it was "shocked" by the verdict
handed down by the Hangzhou Arbitration Commission the previous day
and would appeal according to the legal procedures.
The panel ruled that the popular Wahaha trademark belonged to
Wahaha Group, Danone's Chinese joint venture partner.
Danone had contended that the Wahaha trademark belonged to the
joint venture. However, the panel ruled that a Trademark Transfer
Agreement, jointly signed by the two groups in 1996, which
indicated that the trademark should be transferred to the joint
venture, had expired in 1999.
The move was the latest in the dispute between the Chinese drink
group and the French giant that emerged in April and has become
highly public.
Wahaha Group said Tuesday that they welcomed and felt
"gratified" for the verdict.
Shan Qining, spokesman of Wahaha Group, said "the verdict shows
that we have a legal basis in all of our accusations against
Danone."
He declined to further comment on Danone's reaction after the
verdict.
Danone was dealt a another setback on Monday, when the Guilin
Intermediate People's Court agreed with a complaint by Wahaha and
ruled that Francois Caquelin, a Danone executive, had breached the
company law and "caused turmoil and chaos" in production and
sales.
Danone expressed regret at the court's ruling and also said they
would appeal to the Higher People's Court of Guangxi Zhuang
Autonomous Region.
Wahaha Group chairman Zong Qinghou said, "Danone would not
achieve its goal of merging with Wahaha whether it wins or loses
legal action, and it is not getting the upper hand at present."
Danone, which owns a 51-percent stake in the 39 Danone-Wahaha
joint ventures, has accused Wahaha of setting up independent
companies and selling products identical to those sold by the joint
ventures. Danone had demanded a 51-percent stake in the non-joint
venture companies, which Wahaha rejected.
Since mid-year, the two companies have filed numerous complaints
and lawsuits against each other in various Chinese and foreign
jurisdictions.
Danone filed its first lawsuit against Wahaha on May 9 in
Stockholm, and on June 4, Danone filed another lawsuit, in Los
Angeles, against two Wahaha-related companies and two
individuals.
Also in June, Wahaha filed a request with the arbitration
commission in the eastern Chinese city of Hangzhou over the
disputed trademark transfer.
It also lodged suits in Shenyang and Jilin against Danone
executives Emmanuel Faber, who replaced Zong Qinghou as chief of
Danone and Wahaha's 39 joint ventures, Qin Peng, China director for
Danone Asia, and Francois Caquelin, a financial director, claiming
they had breached company law or damaged the interests of the
Danone-Wahaha joint venture.
In July, Danone filed a counterclaim against Wahaha, alleging
that Wahaha had failed to transfer trademarks to their joint
venture under an agreement reached in 1996 when their cooperation
started.
(Xinhua News Agency December 12, 2007)
