Nestlé has filed a lawsuit against its former business partners in Thailand for rights infringement of the Nescafé trademark.
The trademark owner of Nescafé is seeking damages of 577 million baht from Prayudh Mahagitsiri and Chalermchai Mahagitsiri, according to a company statement dated May 30, reports the Bangkok Post.
The damages are based on losses incurred during an eight-day halt in Nescafé product sales, following the Minburi Civil Court's emergency injunction order on April 3 prohibiting Nestlé from manufacturing, outsourcing production, distributing, or importing instant coffee products using the Nescafé trademark in Thailand.
Later that same month, the Central Intellectual Property and International Trade Court issued an order affirming that Nestlé (Thai) Ltd has the exclusive right to use the "Nescafé" and "เนสกาแฟ" trademark in Thailand.
On May 28, a mediation session occurred at the Central Intellectual Property and International Trade Court regarding the recent lawsuit involving the Mahagitsiri family for allegedly infringing upon the Nescafé trademark.
Representatives from both parties were present, but they were unable to reach an agreement.
The court scheduled the case for trial and set the issues for dispute resolution on June 9.
On March 14, Nestlé filed a petition with the Southern Bangkok Civil Court, asking the court to liquidate Quality Coffee Product Ltd (QCP), a 50:50 manufacturing company co-owned by Nestlé and the Mahagitsiri family, including Mr Prayudh and Mr Chalermchai.
This request was meant to let each shareholder group obtain its respective share and reinvest independently, as the company's directors and shareholders were unable to agree on the future direction of QCP.
In addition, Nestlé asked the Southern Bangkok Civil Court to consider appointing an administrator to oversee the financial obligations of QCP and safeguard the company's assets until the court makes a decision on QCP's liquidation.
On May 19, the Southern Bangkok Civil Court completed the examination of three plaintiff witnesses, and scheduled the examination of defendant witnesses for June 26.
Following the resumption of Nescafé product distribution in April, Ekkapong Chokchaiwitut, chief executive of Mother Marketing Plc, operator of Mother Supermarket and Mother Marché in southern Thailand, said sales have returned to their usual levels.
However, the overall market recorded a dip in sales, likely due to the low tourism season.
Milin Veraratanaroj, chairman of Tang Ngee Soon Superstore, one of the largest traditional wholesale chains in Udon Thani, said the fast restocking of Nescafé products prevented any major customer shifts to other brands.
He said Nestlé Thailand may have imported some Nescafé products from other countries, such as Vietnam, to prepare for the termination of QCP last year.
Regarding the legal dispute, Mr Milin said Nestlé may refrain from distributing or importing large quantities of products, preferring to see how the legal process unfolds.
