Zespri wins damages for unlawful propagation of fruit in China

Kiwifruit leader Zespri has been awarded almost NZ$15 million in damages after a ruling that its SunGold variety was unlawfully taken to China and distributed to other growers. The company sue  took out a civil action in 2018 against kiwifruit grower Haoyu Gao, his wife Xia Xue and their company Smiling Face Limited after discovering that two of its protected varieties were being propagated by Gao and his associates in China. The February 20 ruling found that Gao had fraudulently offered to sell Zespri’s varieties and the right to licence them to parties in China. This was in breach of his contractual obligation to notify Zespri of any infringement he was aware of.

In a statement, Dave Courtney, Zespri’s chief grower and alliances officer said,

“This is an important decision for New Zealand’s kiwifruit growers, as well as for other New Zealand horticultural businesses. If they continue to invest in research and development to create value for New Zealand they will have protections against those who seek to undermine that.”

While the damages awarded were almost $15 million against Gao and Smiling Face, and $10m against Xue, the judge ruled that the maximum to be paid was $15m.

In the 2018-2019 campaign, Zespri sold 167.2 million trays of fruit around the world, with China accounting for about NZ$650m of the firm’s $2.94 billion sales last year.