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TreeHouse Foods Inc. Sues Green Mountain For 'Monopolizing' Single-Cup Pack Market

Posted On: 2/12/2014

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TAGS: office coffee service, OCS news, vending, TreeHouse Foods Inc., Green Mountain Coffee Roasters Inc., Keurig brewer, portion pack lawsuit, single-cup system monopoly, Bay Valley, Sturm Foods, Grove Square, Keurig compatible, Keurig 2.0 brewer, Keurig anticompetitive lockout technology, Sam K. Reed

OAK BROOK, IL -- A lawsuit filed by TreeHouse Foods Inc. charges that Green Mountain Coffee Roasters Inc., maker of the Keurig brewer, has a monopoly on the portion packs used in single-cup systems.

TreeHouse is seeking an unspecified award for punitive damages, as well as legal expenses. The Oak Brook, IL, food and beverage company owns Bay Valley, which sells retailers portion packs used in single-cup brewers. It also owns Sturm Foods, which sells products under private label brands, including its "Grove Square" compatible cups.

In its complaint, filed in the United States District Court for the Southern District of New York, TreeHouse argues that Green Mountain's agreements with various suppliers and distributors are designed to maintain its monopoly power in the brew-by-pack market following the expiration of some of its patents.

TreeHouse also says that the new Keurig 2.0 brewer, launching later this year, will use "anticompetitive lockout technology" that will prevent the new brewers from functioning with cups supplied by unlicensed competitors.

TreeHouse claims Green Mountain's actions are an attempt to eliminate consumer choice and to coerce Keurig 2.0 brewer owners into purchasing only Green Mountain owned or licensed K-Cups. Green Mountain also plans to eliminate the current lineup of K-cup brewers, which accept competitive portion packs. Tree House charges that Green Mountain's intent is to exclude competition and force consumers to purchase its higher-priced K-Cups.

"We are seeking free and open competition on the merits to bring our customers high-quality and innovative products at better prices," said TreeHouse president and chief executive Sam K. Reed. "A favorable ruling for TreeHouse and our subsidiary businesses will prove beneficial to the entire spectrum of consumers, retailers and suppliers."

Green Mountain spokeswoman Suzanne DuLong said that Green Mountain believes the lawsuit is without merit and plans to defend itself vigorously.

In 2010, Green Mountain filed a lawsuit that accused Sturm Foods of infringing two patents related to the K-Cups used in the Keurig single-serving brewing system that the roaster acquired in 2006.