Beyond Meat Has Finally Settled A 5-Year-Long Contract Lawsuit

On October 19, 2022, two plant-based meat companies and former business partners, Don Lee Farms and Beyond Meat settled a lawsuit initially filed in 2017. According to Food Navigator, this settlement is the newest chapter in an ongoing legal battle between the two companies.

Issues began between the two companies when Beyond Meat terminated Don Lee Farms' contract in 2017. Up until that point, the companies were co-manufacturers, explains Food Dive. The case, settled on October 19, specifically addresses Beyond Meat's decision to cut ties with Don Lee Farms. Don Lee Farms' lawsuit accuses Beyond Meat of fraud, breach of contract, incomplete payments, and overall mistreatment of Don Lee Farms. The case went to trial in September 2022.

Don Lee Farms lost its first lawsuit against Beyond Meat in August 2021, reports The Beet. Echoing their later lawsuits, their first case against Beyond Meat claimed that the company's practices created unfair advantages over their competitors in addition to sharing proprietary knowledge. Of their 2021 victory, Beyond Meat stated, "The Court's ruling puts an end to the fictional narrative Don Lee Farms has attempted to use throughout this case that Beyond Meat misappropriated Don Lee Farms' trade secrets to manufacture the Beyond Burger and other products." However, the fraught relationship between the two plant-based meat companies was far over.

The October 19 settlement between Beyond Meat and Don Lee Farms resulted in claims from both parties being dismissed. Per Food Navigator, the settlement states, "No party admitted liability or wrongdoing in connection with the settlement. Both sides are satisfied by the outcome." The settlement closely follows Beyond Meat's decision, announced on October 14, 2020, to lay off 200 employees, 19% of their workforce (via Beyond Meat).

In addition to the now-settled lawsuit, Don Lee Farms is suing Beyond Meat and its CEO Ethan Brown. Food Dive reports that the suit filed by Don Lee Farms in federal court accuses Beyond Meat of making false claims about its ingredients. In a case filed on June 2, 2022, Don Lee Farms accuses their former partner of overestimating the amount of protein in their products by 30%, writes The Beet.

This accusation is significant since Beyond Meat's main advantage is its products' high amount of protein. Don Lee Farms accuses Beyond Meat of violating the federal Lanham Act and California's laws against unfair competition and deceptive advertising, which harms consumers. Similarly, they say that the company's false advertising gives them an unfair advantage against competitors (via Food Dive). Currently, this lawsuit is in private mediation. Of the case, a spokesperson for Beyond Meat stated, "The allegations in the filing lack merit and we are prepared to vigorously fight this in court." That said, Beyond Meat faces other lawsuits that address similar issues.

Beyond Meat is facing a class-action lawsuit filed by six Illinois residents, states The Beet. The lawsuit — filed on May 31, 2022 — alleges that the company's products provide about 7% of the suggested daily protein value instead of the 40% advertised on labels. The lawsuit asserts that Beyond Meat either " ... tested, or should have tested, the Products prior to sale," and, via Food and Beverage Insider, that the company either knew " ... or should have known that the claims are false and misleading on the Products."

Both of the lawsuits question Beyond Meat's status as plant-based and all-natural. Both cite the company's use of methylcellulose, a common synthetic emulsifier used for texture on plant-based foods (per Food Dive). Methylcellulose is made of chemically-treated plant cells, calling into question the company's identity as all-natural (via The Beet). Both Beyond Meat and its competitor, Impossible Meat, use methylcellulose, which the U.S. Food and Drug Administration (FDA) has approved. However, other companies like Don Lee Farms, which claims to sell "the first truly all-natural plant-based burger," do not.

Regardless of the recent settlement between Don Lee Farms and Beyond Meat, consumers and regulators may pay more attention to plant-based meat's ingredients, states Food Dive. Furthermore, the other legal battles Beyond Meat faces could make those interested in plant-based diets wary of plant-based meat alternatives altogether. Trends in whole-food substitutes for traditionally meat-based ingredients, such as grilled vegetables or homemade bean-based recipes, could rise.