A lawsuit brought by American Licorice accusing Total Sweeteners of breaching its contract by supplying molasses tainted with lead will proceed, a Californian district judge has ruled.
A motion to dismiss the case was rejected by the judge last week.
Lead contamination recall
The case relates to American Licorice’s 2012 nationwide recall of its black licorice products because of lead contamination above legal limits.
The US food and Drug Administration prohibits levels of lead 0.1 parts per million (ppm) limit for candy frequently consumed by small children.
After the recall was issued, American Licorice traced the source of the lead to bulk refiner syrup, a grade of molasses, supplied by Total Sweeteners, which is also known as Batory Foods.
On whose terms?
Neither company disputes the source of contamination, but the firms are at odds over the terms of supply contracts.
The parties first signed a sales contract in 2011 to cover the whole of 2012.
But before the first shipment arrived, American Licorice issued a Purchase Order with different terms and conditions. It used similar purchase orders for all subsequent deliveries.
When American Licorice first filed its lawsuit, it relied on the 2011 sales contract. Total tried to have these claims dismissed in May 2013 and America Licorice amended the complaint to include the terms in the 2012 purchase order.
Total tried to dismiss the case again, but judge last week ruled that a jury must decide on which terms the parties agreed.