Beyond Meat Settles Investor Lawsuit Ahead Of Battle With Former Co-Manufacturer

3 Mins Read

Beyond Meat has cut its losses and agreed to settle an investor lawsuit. The plant-based meat producer will be liable for $515,000 in attorney’s fees and must make significant adaptations to its corporate governance structure. The lawsuit was initially launched by investors in light of legal trouble with former co-manufacturer Don Lee Farms. That case is set to reach California’s Superior Court soon.

Settlement has been agreed by all parties involved, with Beyond noting that it was not an admission of wrongdoing. The action taken was not class-action, meaning there will be no reimbursement to any investors other than those specifically named as plaintiffs. 

Beyond Meat burger patties.

Appeasing shareholders before going into battle

Paying legal fees and compensation up to $2,000 per named investor has been cited as a relatively low-impact and fast way to address disgruntled investors. However, the structure of the company’s board also needs a shake-up. As part of the settlement, Beyond had to agree to add a risk committee, which will objectively interrogate all potential legal, ethical, strategic and operational difficulties facing the company. 

Risk committees have become a popular addition to company boards, particularly in light if difficulties arising from the Covid-19 pandemic. Though it is acknowledged that having the committee in place from inception would likely not have prevented the investor lawsuit, it could have mediated early on.

Following the board reconfiguration, two-thirds of Beyond’s governance structure will be fully independent of the company. CEO Ethan Brown will remain in position as the board chairman, representing the only figure that has direct involvement in the operational side of the company. 

Additional reparations will include Beyond posting details of its corporate whistleblower program and corporate governance on its website. 

Beyond Meat sausages.

Beyond Meat and Don Lee 

While the investor lawsuit has proven to be a fairly insignificant offshoot of other legal drama, the Don Lee case remains in full swing. Dating back to 2017, Don Lee accused Beyond of multiple transgressions. These included stealing trade secrets, providing unusable and unsafe ingredients, failing to pay for services rendered and failing to supply suitable equipment and human resources for product manufacture. Beyond countersued in 2020. 

The Superior Court trial is scheduled to begin next month, with Beyond claiming to be ready to “vigorously defend” itself and former employees named in the case. If Beyond is not successful in denying the claims against itself, the damages are expected to be steep and potentially, catastrophic. The company has been unable to estimate the conceivable amount, but observers have noted that now was a good time to settle with investors.

Beyond Meat’s jerky line.

Beyond trying to reclaim its former glory

Beyond enjoyed a stratospheric growth period, during the pandemic, when consumers were looking to shop for healthier, or what they perceived as better, food. As normal consumption habits crept back in, the growth curve was not maintained, leading cynics to proclaim that plant-based meat is over and major players have experienced their peak. Brown has been explicit in his opinion that Beyond can bounce back, telling stakeholders in an earnings call, in February, that recovery would happen in the next 10 months. 

In a bid to maintain business as usual, the alt-protein giant has engaged in multiple strategic partnerships to grow the presence of the brand. Two new dishes have been launched with Panda Express, to tap into the QSR market that has, so far, served Beyond well. In addition, it has developed a vegan jerky range as the inaugural product launch for its partnership with PepsiCo and most recently, a Pinduoduo store launch was finalised to increase its foothold in China.

All photos by Beyond Meat.


  • Amy Buxton

    A long-term committed ethical vegan and formerly Green Queen's resident plant-based reporter, Amy juggles raising a family and maintaining her editorial career, while also campaigning for increased mental health awareness in the professional world. Known for her love of searing honesty, in addition to recipe developing, animal welfare and (often lacklustre) attempts at handicrafts, she’s hands-on and guided by her veganism in all aspects of life. She’s also extremely proud to be raising a next-generation vegan baby.

    View all posts

You might also like