General Mills Fights to Keep Yoplait Licensing Deal
French dairy company Sodima, which owns the Yoplait yogurt brand, wants to terminate an agreement that it has with General Mills, Inc., in 2012, General Mills said in a Friday filing with the U.S. Securities and Exchange Commission (SEC).
Golden Valley-based General Mills, which licenses the Yoplait trademark, said in the regulatory filing that it plans to fight back.
“We intend to continue to use the Yoplait trademark under the terms of our agreement, and we will vigorously defend and enforce our exclusive rights to use the Yoplait mark in the United States,” General Mills said in the filing.
General Mills said that it received a letter from Sodima on September 3, purporting to terminate the agreement on September 9, 2012. But General Mills said that the terms of the agreement between the two companies doesn't provide for renegotiation or termination under the current circumstances.
General Mills Spokesman Tom Forsythe said Monday that the agreement allows General Mills to terminate the agreement each time it is renewed. Sodima, however, is only permitted to terminate the agreement if General Mills breaches the agreement itself-and Sodima isn't alleging any breach by General Mills.
“As such, we believe that the agreement remains in full force and effect,” General Mills said in the regulatory filing.
General Mills has licensed the Yoplait trademark since 1977, and the two companies have renewed the agreement twice since then. During that time, General Mills said that it has “invested considerable effort, resources, and capital to successfully build the Yoplait brand and its yogurt business in the United States.”
Forsythe said that the agreement calls for arbitration to resolve disputes between General Mills and Sodima. Consequently, General Mills filed a petition for arbitration on September 7 with the International Chamber of Commerce International Court of Arbitration.
“Our discussions with Sodima are ongoing, and we remain hopeful that the parties will reach a resolution,” General Mills said in the regulatory filing.
General Mills is Minnesota's seventh-largest public company based on its fiscal-year 2009 revenue, which totaled $14.7 billion. The company reported $14.8 billion in revenue for its 2010 fiscal year.