Danone-Wahaha: An Update
The China Business Law Blog has a nice update on the Danone Wahaha litigation around the world. The sense is Danone is winning in court and I cannot help but wonder if it is because it is spending more on lawyers. I do not know this to be the case, but the sense I get from my readings of the various cases is that Danone has a unified worldwide strategy on its litigation and Wahaha does not.
I have been involved in enough international litigation matters to know that rule number 1 is to make sure your lawyers in all countries communicate with each other so as to avoid the situation where you are saying one thing in one country's court one day and another thing in another country's court the next day. A well-oiled litigation machine will spot your inconsistencies and use them to attack or even destroy your credibility. Not saying this is what is happening to Wahaha (because I just do not know), but I am saying this is critical.
For more on this dispute, which symbolizes what can happen to a joint venture gone bad, check out the following:
"Danone v. Wahaha -- Which Of Us Is The Most China Rookie?"
"China Litigation: You Want Government With That?"
"Danone and China's Wahaha: A Lecture on How (Not) to Make Allies Enemies"
"New York Times And Steve Dickinson On The Danone Wahaha China Dispute And On Avoiding Your Own"
"China's Joint Venture Jeopardy"
"Danone v. Wahaha: China Business/Law Lessons To Be Learned"
"Danone vs. Wahaha. Danone vs. China Law Blog. Ogilvy vs. Steve Dickinson. Have I Missed Anyone?"
Comments
It doesn't surprise me. I've been reading on the case much less than you have, but from what I've gathered so far Danone seems to be on the right here. I wouldn't be shock if the only courts that come out in Wahaha's favor are the ones in Shenyang and Hangzhou (gee, I wonder why).
I also read up on your initial post on the matter, and I find it really, really annoying when companies/individuals start pulling the Chinese nationalist slant on issues like this.
Posted by: Conrad | November 27, 2007 6:54 PM
The just-finished visit of Nicolas Sarkozy in China was the opportunity to raise the problem of Danone with Hu Jin Tao and Wen Jia Bao during their talks. Franck Riboud, CEO of Danone was in the plane of Sarkozy for this state visit. They brought the matter of the Danone-Wahaha case. A political, not only legal solution is in the make-up. Danone has trouble with its joint-venture Wahaha in China but it has also troubles in other countries with JV partners like Colombia, India and Turkey. So, there is a swift in strategy Danone will be more cautious in working with partners abroad. For instance, Danone ended its partnership with Bright Dairy in China. The same may happen with Mengniu. Are WFOE the only way to work safely in China? A question that have no straight answer.
Posted by: China and I | November 27, 2007 7:00 PM
I read that Danone is losing the first court cases in Hangzhou where the tribunal said that the Wahaha brand belongs to the Wahaha group, and in Guilin, but don't know the court ruling there.
Any update on your side? What is your analysis of these rulings.
Posted by: G. Mille | December 11, 2007 1:02 AM
Conrad, SCMP reported Swedish court also ruled in favor of Wahaha:
http://www.scmp.com/portal/site/SCMP/menuitem.2c913216495213d5df646910cba0a0a0/?vgnextoid=a663e7f67622b110VgnVCM100000360a0a0aRCRD
Posted by: Charles Liu | July 18, 2008 1:51 PM