A Queensland dairy-free yoghurt company is being sued for up to $20 million by its former UK business partner for alleged negligence that led to a fatal allergic reaction.
London-based Planet Coconut Limited has taken action in Brisbane Supreme Court claiming Sunshine Coast company CO YO Partners provided ingredients "contaminated" with dairy that were then used to make coconut milk yoghurt.
CO YO denied many of the allegations and counter-sued Planet Coconut alleging it is owed more than $586,000 in unpaid fees along with damages for disclosing confidential information and violations of its COYO trademark worth up to $26 million a year.
Planet Coconut then supplied the yoghurt to UK sandwich shop chain Pret A Manger, which used it to make a wrap that was eaten on December 27, 2017 by woman named Celia Marsh, who died shortly after of anaphylaxis.
In a statement of claim filed in February, Planet Coconut said Ms Marsh's death and the subsequent coronial inquiry that identified the COYO brand were widely publicised in the UK.
"(Planet Coconut) received negative publicity and suffered reputational damage," the claim stated.
The lawsuit also claimed that Pret a Manger along with the UK's two biggest supermarket chains, Tesco and Sainsbury's, halted all their business deals with Planet Coconut.
Planet Coconut claimed it suffered costs and reduced sales from the incident totalling $10 million, including costs and compensation from recalling all COYO products in the UK, legal fees, lab testing and external public relations consultants.
The company also sought further or alternative damages of $10m for alleged breach of contract.
CO YO previously granted a 10-year licensing agreement to Planet Coconut for the exclusive use of its COYO branding, recipes and technology to produce and sell coconut milk yoghurt and ice cream in the UK.
Planet Coconut's co-owners, Bethany and Paul Ross Eaton, alleged CO YO co-founder Henry Gosling told them he would "find a way of making CO YO products dairy free".
The Eatons claimed Mr Gosling later showed them COYO branded retail products with "dairy free" on the labels.
Planet Coconut stated it was contractually obligated to purchase HG-1 stabilising agent from CO YO Partners and the source of the milk protein that caused Ms Marsh's death was traced back to a contaminated batch.
In a defence filed in May, CO YO claimed it never "implied" HG-1 would not contain dairy and the term dairy free had no fixed or established meaning in the industry.
"A product may, as matter of industry practice, be described or marketed as being dairy free even if it contains small or trace amounts of dairy," CO YO said.
CO YO stated the HG-1 was manufactured by a third party company in the UK and was "prominently marked" that its factory also handled milk products.
CO YO counterclaimed that Planet Coconut had tried to replace the COYO brand with its own similarly named and designed COCOS branded products to "unlawfully pass off" as the original, denying CO YO access to the UK market.
