Fonterra, Danone in talks to resolve WPC botulism dispute

01-Oct-2013 - Last updated on 02-Oct-2013 at 11:41 GMT

Following Fonterra's precautionary WPC recall - later discovered to have been a false alarm - Danone businesses pulled products from shelves across eight countries.

Fonterra has denied it has “any legal liability” to Danone in relation to its recent whey protein concentrate (WPC) contamination scare, despite being in talks with the French dairy giant over the possible payment of compensation.

In a statement issued earlier today, New Zealand-based Fonterra confirmed reports that it is involved in an on-going “dispute resolution process” with Danone concerning the August 2013 WPC botulism scare that led the latter to pull infant formula products from shelves in eight countries.

“The discussions between Fonterra and Danone had been confidential with a view to reaching a mutually acceptable commercial outcome however some aspects of these discussions have been made public this morning in the press,” said the statement.

While Fonterra has admitted that the payment of compensation to Danone is being considered, it stopped short of admitting fault.

“Fonterra confirms that the discussions remain ongoing but strongly denies any legal liability to Danone in relation to the recall,” the statement added.

Danone-owned infant nutrition manufacturers Dumex and Nutricia Australia New Zealand (Nutricia ANZ) began pulling infant formula products from shelves in eight countries including China, Thailand, Hong Kong and New Zealand in early August, after Fonterra warned them and other customers that three batches of WPC potentially contaminated with botulism-causing Clostridium botulinum had entered the supply chain.

Additional testing, completed in late August, revealed that the bacteria found in the affected WPC batches were not Clostridium botulinum, but Clostridium sporogenes - a non-toxic Clostridium strain.

Following confirmation that Fonterra's precautionary recall had been a false alarm, Paris-based Danone told DairyReporter.com that it was reviewing its “recourse and compensation options."

“Danone is currently studying the different steps that led to this situation and that had an impact on both Danone’s brands and subsidiaries and is reviewing its recourse and compensation options,” Danone spokeswoman Berthet-D’Anthonay told DairyReporter.com at the time.

DairyReporter.com approached Danone earlier today regarding its on-going talks with Fonterra, but no reply was forthcoming prior to publication.