TreeHouse sues Green Mountain Coffee for anti-competitive conduct

Tue Feb 11, 2014 5:22pm EST

Feb 11 (Reuters) - TreeHouse Foods Inc said on Tuesday it had sued Green Mountain Coffee Roasters Inc for allegedly attempting to illegally maintain a monopoly over the pods used in its new Keurig coffee brewers due to be released later this year.

Green Mountain plans to launch the new hot-drink brewing system, called Keurig 2.0, in the fall.

The system will use both single-serve K-Cups and larger-sized K-Carafe packs that brew 28 ounces of coffee.

TreeHouse alleges that Keurig 2.0 has anti-competitive lock-out technology that will prevent it from functioning with cups supplied by unlicensed competitors.

The complaint said this was an attempt to eliminate consumer choice and force consumers to buy higher-priced Green Mountain cups.

Green Mountain's Keurig machine popularized the use of pods - small packets containing everything from coffee, tea or hot chocolate powder - for easy, in-home, one-cup brewing of hot drinks.

Sales of the company's K-cups have risen steadily, even though the expiry of some patents on its single-serve coffee pods in 2012 allowed rivals such as TreeHouse and Caribou Coffee Co Inc as well as private-label companies to launch their own products.

Green Mountain has also licensed K-cups to companies such as J.M. Smucker Co, Starbucks Corp and Associated British Foods Plc, which sell their coffee and tea in the pods.

The company has sold more than 30 million Keurig machines around the world for use in homes, offices and other locations.

Green Mountain's shares closed at $119.40 on the Nasdaq on Tuesday. Shares of TreeHouse closed at $64.09 on the New York Stock Exchange.

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