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Dairy providers launch business litigation against Trader Joe's

A major business lawsuit has been filed in the state of California, with two suppliers claiming that Trader Joe's treated them as cold as ice. The two ice cream suppliers are pursuing business litigation against the supermarket behemoth, arguing that Trader Joe's dropped their products and then coerced other vendors to terminate their business relationship with the dessert companies. The case alleges that Trader Joe's reached out to other businesses in an effort to undermine the ice cream manufacturers' market presence.

Trader Joe's had stopped doing business with the two entities in March 2013. NDP had been working with Trader Joe's since 2005, and representatives say the company helped the grocery store chain obtain better products from dessert manufacturers. Dairy Smart, another plaintiff, reportedly served as a broker for Trader Joe's for the provision of yogurt, sour cream, butter and other dairy items.

The two companies, NDP and Dairy Smart, are accusing Trader Joe's of interfering with their contractual relations with other business entities. Further, the companies are alleging breach of contract by Trader Joe's, along with acting in bad faith an unjust enrichment. Attorneys for the plaintiffs say that Trader Joe's relied upon the two suppliers to help build a successful frozen dessert program -- but then the grocery store chain severed relationships with the companies and intentionally damaged their other business contracts.

A business can be forced to pay civil penalties for breach of contract through business litigation even if they sabotage others' business relationships. No business entity should have the right to unfairly damage another company's ability to earn a profit. Those who choose to engage in unjust business practices may find themselves in hot water with the civil courts.

Source: Supermarket News, "Dairy suppliers sue Trader Joe's" Jul. 11, 2014

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