A bun fight over trade secrets

File picture

File picture

Published Jun 9, 2016

Share

Durban - Two Durban flour milling companies are involved in a legal bun fight, with one accusing the other of trying to steal “the secrets of its success” - including its blending processes, recipes and customer details.

But while Just Flour Mills claims these put it at the forefront of the industry, rival Bakhresa SA - part of a group operating in nine African countries with a turnover of more than $800 million - has scoffed at this and claims its processes and products are far superior.

“We are a major player... we don’t need this information,” Bakhresa’s advocate, Faisel Abraham, argued this week.

He was opposing an urgent Durban High Court application in which Just Flour, ultimately unsuccessfully, was attempting to enforce a restraint of trade it alleged its former warehouse supervisor Dessica Veeradu - now employed by Bakhresa - signed last year.

In his affidavit Just Flour managing director Kevin Deana said the company was a leading independent flour miller, having grown from humble beginnings in 2000.

“The process of manufacturing flour is extremely technical,” he said.

“And unlike other flour millers, we are not affiliated to any industrial bakeries and we do not produce generic flour for sale by retailers. All of our customers are bakeries and all our products are prepared for a particular end use by our costumers who range from industrial bakers to restaurant chains,” he said.

Competitor

Deana said Veeradu had been first employed as a receptionist and had played several roles in the company, giving her access to key information, until her resignation “to travel and study” in February this year.

Deana claims that he specifically reminded her that she had signed a restraint of trade agreement the previous year.

“She left on very amicable terms and I never suspected she would go to a direct competitor,” he said.

He discovered recently that Bakhresa had employed her “in a like-for-like position” as an assistant warehouse manager “which is not surprising because her intimate knowledge of our trade secrets have incalculable value”.

He said already one customer had gone over to the rival company.

Veeradu, in her affidavit, claims she was forced to resign after being accused of non-performance.

She says the two companies are not competitors and she does not know any trade secrets and, even if she did, she had no intention to “lure customers away”.

Regarding the restraint, she claims she signed a blank document “as a formality” and this dispute of fact could only be settled through oral evidence at a trial.

Bakhresa’s business development manager, Priyaranjan Nath, said its milling operation in South Africa began in May this year after it bought a building and installed “the Rolls Royce of milling machinery”.

“We mill a brand of flour called Azam which is unique to us and is in no way linked to any milling operations carried out by Just Flour.

“It is clear that we do not require the expertise, know-how and processes of Just Flour to carry out our day-to-day functioning. With respect, our products, if compared, would be far superior,” he said.

Judge Mahendra Chetty dismissed the application.

Related Topics: