Monday, June 14, 2010

AP runs Bimbo story

On 14 June 2010, AP ran a story titled English Muffin-maker guards `nooks and crannies' relating to the lawsuit between Bimbo Bakeries and former exec Chris Botticella over the trade secret to "nooks and crannies.". IPBiz had covered the matter in two earlier posts:

Bimbo Bakeries goes after former exec on secrets of Thomas' English Muffins
[25 Jan 2010]

HR people need to be up to speed on IP issues: Bimbo Bakeries

Within the AP story:

The company says only seven executives know all three parts of its winning formula for making the muffins -- including how much dough to use, the right amount of moisture and the proper way to bake them.

So it became alarmed and sued in January when Botticella, one of the trusted seven, decided to bolt and join rival Hostess, maker of Wonder Bread and Twinkies.

The AP story notes Botticella "argued the confidentiality agreement he signed was valid "only during his employment" and does not bar him from working for Irving, Texas-based Hostess, a privately held company." and states the legal issue is "whether a leak must be inevitable or merely probable before the judges can stop Botticella from taking his a new job."

The last lines of the AP story are memorable:

"It's a horrible situation he finds himself in," said one of his attorneys, Elizabeth K. Ainslie. "If the assistant coach of the Philadelphia Eagles moves to the Dallas Cowboys, is he supposed to forget all of the plays that he learned while at the Eagles?"

One notes that the "plays" of the Eagles are performed in public, and can be legally studied by anyone. The secrets of "nooks and crannies" are executed in private and only the finished product is exposed to public viewing.

If this were Coca Cola's secret formula, would people view this differently?

**In a piece titled Thomas' English Muffin Doesn't Want Hostess All Up in Its Nooks and Crannies , the Village Voice adds:

According to the AP, there are but seven executives who know the exact formula that causes the English muffins to develop their nooks and crannies (which, not incidentally, are trademarked). One of those executives, Chris Botticella, was hired by Hostess, and according to the lawsuit, hid his hiring for months while attending high-level meetings with Bimbo Bakeries, the company that owns Thomas. The topic of those meetings? Strategies for competing with Hostess.

USA Today gets into the bigger picture of Mexican investment in the US:

Grupo Bimbo, Latin America's largest baked-goods company, has also expanded its U.S. operations.

In 2009, Mexico City-based Bimbo bought the U.S. baked-goods operations of Weston Foods for $2.4 billion, taking over 22 industrial bakeries and 4,000 distribution routes. In all, the Mexican company has 35 bakeries in the USA turning out national brands such as Entenmann's pastries, Boboli pizza crusts and Thomas' English Muffins to regional brands such as Brownberry bread and Mrs. Baird's snack cakes. About 43% of Bimbo's 2009 sales were in the USA.

New investment in the USA by Mexican companies rose from $3.6 billion in 2005 to nearly $8 billion in 2008, according to the latest statistics from the U.S. Department of Commerce. Mexican companies employ about 59,000 people in the USA.

Like Bimbo and Lala, many of the Mexican companies operate regional subsidiaries, a structure that obscures their immense size.

Buying up well known trademarks is a great way to effect this strategy: which product is a US customer going to buy, one called Entemanns or one called Bimbo? Trouble is, somewhere along the line, Entemanns chocolate crumb donuts vanished.
Products count, too.

***Separately, Bimbo is looking for an employment attorney:

Bimbo Bakeries USA, the leading commercial baker in the United State is seeking an employment lawyer at its corporate office in Horsham, Pennsylvania. Employing over 15,000 associates and selling over $4 billion in baked goods annually, the Company’s brands include Entenmann’s, Arnold, Brownberry, Oroweat, Freihofer, Thomas’, Stroehmann, Bimbo, Marinela and Boboli. The incumbent will provide legal advice on employment matters. This position reports to the General Counsel.


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