Frito-Lay and Innovia in legal battle over biodegradable film patents
Each declares they developed the specialist technology for the films and has laid claim to the ground-breaking and lucrative packaging. The dispute comes six years after the firms agreed to work together on the project.
Frito-Lay, a subsidiary of PepsiCo, yesterday filed a US civil lawsuit against Innovia in a bid to resolve the long-running row over two patents for the biodegradable films.
The action follows a move by the UK-based film producer to halt Frito-Lay's patent applications in Europe, which received US approval in 2009 and May 2011.
In 2009, Frito-Lay, introduced biodegradable bags for its range of SunChips snacks but famously had to withdraw them after a consumer outcry that the eco-friendly flexible packaging was too noisy.
The parties look set for a court room showdown after entering into agreement to work together on the scheme in 2005. They signed a confidentiality agreement on the project following a series of meetings between February and October at Frito-Lay’s headquarters in Plano, Texas.
Innovia said that it provided Frito-Lay with specialist information on biodegradable films as part of this arrangement and accused it of breaking the deal.
However, the US firm said the confidentiality pact did not “result in any formal or informal business arrangement between the parties”.
It added the terms of the agreement allowed each party to continue “developing information internally, or receiving information from other parties that is similar to that party’s Confidential Information”.
Furthermore neither company would ”refrain from developing or authorizing another to develop any product , concepts, systems or techniques that are similar to those contemplated” by the parties, said Frito-Lay quoting the agreement in its complaint to the US District Court for the Eastern District of Texas.
The snack giant added that it had started its own research into biodegradable films in 2004 – a year before it held meetings with Innovia.
“That research continued both during and after the time Frito-Lay met with Innovia. As a result of their independent research efforts, Frito-Lay scientists and engineers discovered and invented novel flexible film packaging that maintains certain barrier properties and that is made up of several layers of films, including a biodegradable ‘bio-based’ layer,” said Frito-Lay.
The seeds of the looming case were sown when Frito-Lay applied for several US patents for the films in May 2009. The action prompted a demand from UK-film manufacturer for a “free license for Innovia and its subsidiaries” that would cover the food firm’s intellectual properties rights.
When Frito-Lay dismissed the request, Innovia accused it of violating the confidentiality agreement and launched a series of actions in Europe to claim ownership of the patents.
These include an application to the UK Intellectual Property Office and the threat of High Court proceedings. Earlier this month, it lodged an action with the Patent Courts of the High Court of Justice of England and Wales, which has yet to be served on its US adversary.
The company, headquartered in Cumbria, England, also made a successful request two weeks ago to suspend Frito-Lay’s patent claim in Europe.
Frito-Lay has denied all allegation made by Innovia and said that it, not Innovia, “developed the technology to produce this certain biodegradable packaging and therefore is the rightful owner of the ’436 patent, the ’218 patent”.
It has filed a civil suit in its home state of Texas and requested that a jury hear the case to resolve what it calls “the expensive and damaging uncertainty” around the patents.
An Innovia Films spokeswoman told FoodProductionDaily.com: “Innovia Films is an acknowledged world leader in sustainable packaging materials and is always willing to work with major food manufacturers and brand owners to develop innovative solutions in this area. Innovia Films invests heavily in its R&D to develop valuable intellectual property on a worldwide basis. We also respect the intellectual property of others. We have become aware of the action filed yesterday in Texas and will be reviewing the matter with our advisors.”
FoodProductionDaily.com also contacted Frito-Lay but no comment was received prior to publication.