El Pinto V. Ocean Spray: Lawsuit Over Cranberry Salsa

El Pinto Foods, LLC, an affiliate of the venerable, 50-year-old Albuquerque New Mexico restaurant, has brought a lawsuit in United Sates District Court alleging that Ocean Spray Cranberries, Inc. breached a 3-year Contract under which El Pinto would manufacture Ocean Spray and Cranberry Relish.

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El Pinto Restaurant and Salsa Factory Entry

This is the first time in our 50-year history we have had to file a lawsuit, but Ocean Spray used our equipment, our experience, our employees, and then walked away.

Albuquerque, New Mexico (PRWEB) October 30, 2013

El Pinto Foods, LLC, an affiliate of the venerable, 50-year-old Albuquerque New Mexico restaurant, has brought a lawsuit in United Sates District Court alleging that Ocean Spray Cranberries, Inc. breached a 3-year contract under which El Pinto would manufacture Cranberry Salsa and Cranberry Relish.

Ocean Spray Cranberries, Inc., is based in Massachusetts and manufactures and markets a wide array of cranberry products. (1)

El Pinto claims in court documents under the contract, Ocean Spray agreed to pay El Pinto $5 per case for 200,000 cases per year of Salsa and Relish. At Ocean Spray’s written request, El Pinto spent approximately $1 million upgrading their factory to produce the cranberry products. After two years of research and development, Ocean Spray decided to produce the Salsa in Canada instead and walked away from the Contract.

Ocean Spray claimed that El Pinto’s factory failed a crucial “commissioning” test, while in fact, on the day of the test, a massive windstorm caused electrical brown-outs in the North Valley, which slowed the production line. Despite its own internal procedures requiring a re-test, Ocean Spray used this incident as an excuse to breach its contract. Ocean Spray refused requests by El Pinto to reimburse the moneys spent on upgrading the factory, resulting in the lawsuit.

The lawsuit also alleges that Ocean Spray is using trade secrets and production methods it learned from El Pinto to produce salsa in Canada.

"This is the first time in our 50-year history we have had to file a lawsuit, but Ocean Spray used our equipment, our experience, our employees, and then walked away," said John Thomas, who owns and operates El Pinto with his twin brother Jim. El Pinto Foods produces its own packaged salsa and other products at its North Valley factory.    

The trial is set for August 18, 2014 in United States District Court for the District of New Mexico before US Magistrate Judge Karen B. Molzen case No. 1:12-cv-01293-KBM-RHS

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1 http://www.bizjournals.com/boston/blog/mass_roundup/2013/10/ocean-sprays-headway-in-latin-america.html


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