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Arla Foods initiates counterclaim

27-May-2003

Denmark's Arla Foods has issued a counterclaim in response to an action for damages brought by its US tagatose licence partner, Spherix.

The move follows Spherix' claim for damages and repeated criticism of Arla Foods which Arla Foods says it believes is creating uncertainty about its rights to tagatose.Arla Foods added that it would not normally comment on pending cases, but in this particular instance the group has decided to counter Spherix' accusations.

 

In partnership with the German sugar producer Nordzucker , Arla Foods recently began commercial production of Gaio tagatose, a low-calorie sweetener which looks and tastes like sugar. Gaio tagatose is produced from the milk sugar lactose through a process patented by Spherix. Arla Foods acquired the rights to tagatose for use in foodstuffs in 1996.

 

In the same year, Arla Foods says it invested in facilities for trial production and initiated clinical studies and has since worked on preparing the product for the market. In 2002, however, Spherix decided to bring a case against Arla Foods at a Court of Arbitration in the US as a result of what it felt were excessive time delays to production.

 

"We're disappointed about the lack of support from Spherix during our efforts to market Gaio tagatose," said executive director Henrik Andersen at Arla Foods Ingredients.

 

"We have driven the process as rapidly as possible and have every possible interest in ensuring the product's success in the shortest possible time. We're now ready to market the product in the US - the largest potential market - but find ourselves in dispute with our partner. It's a somewhat unusual situation. To protect our interests, therefore, we're making a counterclaim against Spherix."

 

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