A trade secrets lawsuit regarding Yost Foods Inc.’s margarine recipe was removed to the Northern District of Ohio on Wednesday by the defendant, Bunge North America Inc. The complaint, which was initially filed in the Medina County, Ohio, Common Pleas Court on March 12, alleges that Bunge used information it learned through a business relationship with Yost to take a customer who had purchased margarine from Yost for over 10 years.
Bunge, a global agribusiness and food company, said in its notice that the United States district courts have original jurisdiction because the two parties are citizens of different states and the amount in controversy exceeds the required amount for the matter to be heard in district courts.
In the complaint, Yost, an “industry leader in custom food ingredient manufacturing and distribution,” purported that Bunge violated a confidentiality agreement with the plaintiff, and interfered with its relationship with a long-time customer, Bob Evans Farms Inc. Reportedly, Yost entered the confidentiality and business agreement with CFS West Foods, a margarine manufacturer, in 2009 where Yost would pay CFS West Foods to co-pack, manufacture, and sell its product. In 2011, Bunge acquired CFS West Foods and continued the contract.
Yost claimed that the defendant was also required to keep the confidentiality agreement, which had been agreed to by CFS West Foods, and not give the proprietary information therein to a third party or use it for its own benefit. The business relationship between the two companies continued through July 2020.
Rather than keeping the confidentiality agreement, however, Yost alleged that Bunge used a proprietary flavoring ingredient known as FL8035, which is used in Yost’s 80% Uncolored Liquid Margarine product that Bunge previously produced for the plaintiff. Specifically, the defendant was accused of creating its own version of the 80% Uncolored Liquid Margarine to sell to Bob Evans Farms at a lower price, using the plaintiffs FL8035, shortly after the business agreement between the parties ended.
Yost claimed that the information Bunge had because of their business relationship, including financial and economic information, customer lists, and ingredient information were generated over years and gave Yost “a significant competitive advantage.” Bunge reportedly used this information to “undercut Yost” and get business from Bob Evans Farms. Yost said that it had sent a cease and desist letter, but Bunge continued to breach the parties’ confidentiality agreement leading to a legal attempt by Yost to enjoin the defendant from continuing to use its trade secrets.
In the petition, Yost claimed it has suffered over $1.1 million in monetary damages. The plaintiff asked the court for monetary relief and protection for its “valuable business relationships, confidential information, and goodwill.”