Miyoko’s Creamery Lawsuit: Case Filed By Plant-Based Dairy Company Against Founder
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Plant-based dairy company Miyoko’s Creamery has filed a case against founder Miyoko Schinner alleging breach of contract and company IP misappropriation.
Earlier today, Green Queen received a PDF copy of court filings detailing that on February 16, Miyoko’s Creamery filed a complaint case in the United States District Court for the Northern District of California naming founder and former CEO Miyoko Schinner as the sole defendant.
The filings cite a range of complaints against Schinner: Breach of Contract, Violation of Defend Trade Secrets Act, Violation of the Uniform Trade Secrets Act, Breach of Duty of Loyalty and Breach of Promissory Note.
According to the filings, Schinner allegedly stole company IP and “hatched a plot to steal the Company’s property, trade secrets, and confidential information so that she could create a competing company.”
In the documents, the company says it issued multiple notices to Schinner upon discovering her plans and asked her to return the confidential items which included R&D materials such as “proprietary recipes and plant-based culture configurations”. It claims Schinner did not comply and as a result, the company “was forced to bring this action to protect its trade secrets and confidential information.”
Further allegations against Schinner mentioned in the filings include not being able to develop or maintain a strong executive team, repeatedly missing performance and financial targets, refusing to facilitate a smooth transition following her departure as CEO, and enlisting the help of now-former company employees to help her steal company documents.
Legal news service Law360 first reported the lawsuit.
Green Queen has reached out to Schinner for comment and this story will be updated when we hear back.
Update 20 Feb 16:35 – Schinner has posted a reply on social media: “I am shocked that certain board members have decided to file a lawsuit against me. There are wild untruths about me that are designed to destroy me and get me out of the way. I have been cooperative with the Company since my termination…While I am eager to bring the truth to light, I am going to move with the care necessary to ensure that I am operating in accordance with my fiduciary duties as a Director and with applicable legal rules and guidelines. (while I remain a Director, I am uncertain of how much sway or say I actually have). As always, I thank you for your trust, your patience, and your support.”
Schinner was removed as CEO last June
On Thursday (February 16), the company issued a press release stating that it has parted ways with company founder Miyoko Schinner citing “a new stage of growth” for the organization. The company said Schinner had exited as CEO and was no longer involved in day-to-day operations. It announced that it had hired executive search firm Heidrik & Struggles to help find a new CEO and that existing company CFO Jon Blair had taken on the role of interim President “to guide this transition” in the meantime. Schinner remains as board Chair.
In the court filings, the company says it “unanimously terminated her as CEO to move her to a more appropriate employee role” and that the company’s rapid growth “required a CEO capable of taking on the increased responsibilities that come with an expanding business and the management of a larger company.”
In a social media post commenting on the news, Schinner said that her removal as CEO “occurred months ago in June 2022” and that “negotiations for my continued involvement stalled before Christmas”, concluding that “we did not arrive at this point by my choosing”.
Miyoko’s Creamery: a vegan dairy pioneer
Miyoko’s Creamery (originally Miyoko’s Kitchen) was founded in 2014 by Schinner, a longtime vegan chef, cookbook author, activist and TV presenter.
The company, which earned B Corp status in 2019, produces a range of vegan dairy products aimed at consumers and food service including cashew-based artisan cheese wheels, a popular European-style butter, cream cheeses and other plant-based dairy spreads, and liquid mozzarella.
According to a 2021 press release, the company’s products are sold in over 20,000 retailers worldwide.
Two years ago, Miyoko’s won a legal battle against the State of California that granted the company permission to use the term “butter” to describe its products after winning a preliminary injunction in 2020, with the Judge commenting that “the State’s showing of broad marketplace confusion around plant-based dairy alternatives is empirically underwhelming.”
That same year, the company raised a $52 million Series C funding round led by PowerPlant Partners, with participation from CPT Capital, Obvious Ventures, Stray Dog Capital and JMK/Cult Capital.
Last year, Miyoko’s raised just under $7 million in equity from undisclosed investors; BizJournals reported the company has received over $78.6 million worth of funding since its founding. According to data published on Dealroom, the company was valued $260 million as of June 2022.