Organic Valley and its farmer-owned cooperative, CROPP, have been named as defendants in a lawsuit filed by Horizon Organic Dairy, a subsidiary of Dean Foods in a Colorado federal court. The lawsuit accuses Organic Valley and their employee, Larry Hansen, of breaching a prior confidentiality agreement Hansen had with Horizon.
Until May, Hansen worked in dairy procurement for Horizon, covering the West Coast, Texas and New Mexico. Hansen left Horizon in May and took a similar position with Organic Valley soon afterward.
The lawsuit claims that Hansen is in a similar position at Organic Valley and covers the same territory as he did while with Horizon and that threatens a “disclosure and/or use of proprietary information and trade secrets” and makes such a disclosure inevitable.
Horizon further claims that Hansen has contacted suppliers he worked with in his prior position and that he will continue to use information proprietary to Horizon in his new position with Organic Valley.
The lawsuit seeks actual and punitive damages, plus a block on future revenues stemming from the alleged misconduct.
“We don’t typically discuss pending legal matters, but in this instance we feel it's worth noting for the record that we chose to take legal action because neither Larry Hansen nor his new employer, Organic Valley, would otherwise talk to us after repeated attempts,” Sara Loveday, the Communications Manager for White Wave Foods/Horizon Organic, said in the company’s official statement.
Horizon claims the lawsuit is a result of failed communication between the two organic dairy operations, claiming they made several attempts to contact Hansen and Organic Valley to discuss confidentiality concerns and potential legal action and received only a half-page letter from Hansen’s lawyer in response.
“Our intent is not to restrict Hansen from being employed by Organic Valley, but rather to understand clearly the extent to which his new position breaches his contractual obligations,” Loveday said.
Organic Valley spokesperson Elizabeth Horton said her hands are rather tied when it comes to commenting now that the affair is in litigation, but the company views the lawsuit as meritless and without basis.
“CROPP hired an employee that worked for WhiteWave Foods, a subsidiary of Dean Foods, Inc., and WhiteWave claims that the employee, who has been working in the dairy industry for years, must be prevented from working for CROPP (or any other competitor to Horizon Organic) in any capacity and that simply hiring the employee was misconduct,” Horton said in Organic Valley’s official response.