New KCC headquarters. The New Kenya Co-operative Creameries (New KCC) has opened a court battle against Eldoville Dairies over the use of the name “Mala” on a rival brand of sour milk. Photo/FREDRICK ONYANGO
What you need to know:
KCC was initially owned by farmers but it collapsed, forcing the government to bail it out of massive financial woes caused by gross mismanagement.
New KCC wants its rival ordered to publish an apology in a local daily with wide circulation, and to desist from using the name “Mala” for its brand of sour milk.
The New Kenya Co-operative Creameries (New KCC) has opened a court battle against Eldoville Dairies over the use of the name “Mala” on a rival brand of sour milk.
New KCC holds in court filings that it has owned the “Mala” trademark since 1963, and that Eldoville has violated its ownership rights by using the disputed name to market a brand of sour milk.
The firm says that Eldoville has ignored numerous demands to stop using the disputed name, and it now wants the court to intervene. New KCC wants its rival ordered to publish an apology in a local daily with wide circulation, and to desist from using the name “Mala” for its brand of sour milk.
Eldoville’s is yet to file a response in court.
“As a result of the said use of New KCC’s trademark, the plaintiff is incurring substantial losses and it is only fair and just that this court intervenes in order to stop the infringement. It is only fair and just that Eldoville do immediately remove the name “Mala” from its products.
There is need for the defendant to publicise in a local daily of wide circulation an apology,” New KCC says.
The firm which is set for privatisation wants the court to order an inquiry into how much Eldoville has made through the alleged infringement of its trademark rights and then determine how much New KCC deserves in full compensation.
Bailout
KCC was initially owned by farmers but it collapsed, forcing the government to bail it out of massive financial woes caused by gross mismanagement.
The milk processor has an asset base of Sh4.8 billion, which is mostly in production equipment and real estate properties.
Its buildings are valued at Sh1.64 billion while plant and machinery, including 22 factories and cooling plants, are worth Sh1.494 billion.Motor vehicles are valued at Sh254.5 million while furniture and office equipment are worth Sh14.7 million.
Its rival Eldoville is a family-owned business established by Lucy Karuga in June 1985.
Eldoville mainly processes cheese, butter and yoghurt. Pearl Capital Partners, a private equity firm, in 2014 bought a minority stake in Eldoville Dairies Limited for Sh200 million.
New KCC says the other five competitors in the market have deliberately avoided the use of the name “Mala,” which it insists is a sign that its ownership of the trademark rights are well known.
The name was coined as an amalgamation of “maziwa lala” which is Swahili for sour milk.
New KCC has attached documents from the Registrar of Trademarks acknowledging that it is the only party legally allowed to use the word “Mala.”
An enquiry as to damages or an account of profits and payments of all sums found due should be paid back to New KCC,” says Peter Ombati, New KCC’s company secretary.
