Ocean Spray – Decas cranberry dispute steps up a notch

23-Jun-2009 - Last updated on 24-Jun-2009 at 16:13 GMT

Two leading North American cranberry producers – Ocean Spray and Decas Cranberry Products – have turned to the courts in a fight to maintain competitive positions and market shares for their sweetened dried cranberry products.

Decas yesterday shot back at an Ocean Spray complaint, which had alleged last year that the smaller firm was infringing on its SDC patent.

Filed at the United Stated District Court for the District of Massachusetts, Decas’ counterclaims maintain that Ocean Spray’s patent infringement allegations have “no reasonable chance of success” and were “filed in bad faith and with improper motive”.

Battle for market

Ocean Spray’s complaint, filed in October 2008, stated that the process employed by Decas to process its sweetened dried cranberries infringed on part of its own patented process.

However, in the counterclaims filed yesterday, Decas said this was an attempt by the larger player to disrupt Decas’ negotiations with cranberry growers so that it would be unable to contract for the cranberries needed to maintain its current position in the cranberry and SDC markets.

The two firms, both based in Massachusetts, together account for around 70 percent of the North American cranberry market. Decas estimates that it holds about 10 percent of the market, while Ocean Spray has over 60 percent.

Sale gone sour

According to Decas, the two companies were last year in early stages of negotiations regarding the potential sale of Decas to Ocean Spray, which was one of ten interested buyers.

In June, Ocean Spray’s president and CEO Randy Papadellis wrote in a letter to Decas that the company “may” be infringing on its patent, but that it would be willing to waive infringement claims if the acquisition went through, states Decas in its counterclaims.

The infringement claims ultimately prevented any sale at acceptable terms, said Decas.

Negotiations unfruitful

Decas told NutraIngredients-USA.com this morning that it had initially tried to resolve the issue out of court.

“Over the past several month we’ve been in negotiations with them, trying to avoid this by providing detailed information that proves we’re not infringing on their patent. But we couldn’t get them to back off so we’ve been force to file,” he said.

For its part, Ocean Spray claimed that Decas had “repeatedly refused to provide information or answer questions about its manufacturing process to allay our suspicions of patent infringement.”

“The counter-claim Decas filed against Ocean Spray is an effort to deflect attention away from the central issue of whether they are violating our patent for manufacturing sweetened dried cranberry products,” said Ocean Spray spokesperson John Isaf.