Nestlé Files a Lawsuit Against Prayudh and Chalermchai for 5.77 Billion Baht Over Nescafé Disagreement
Coffee Clash: Nestlé Battles Thailand's Mahagitsiri Family Over Nescafe Rights
It's a bitter brew in Thailand as global coffee titan Nestlé squares off against the Mahagitsiri clan over who can indulge in the Nescafe business. Swishing their best legal moves, Nestlé, owner of the Nescafe trademark, and Nestlé Thailand have accused Prayudh and Chalermchai Mahagitsiri of jeopardizing the rights to the beloved beverage brand.
In a recent court session on May 28, 2025, the Central Intellectual Property and International Trade Court acknowledged Nestlé Thailand's exclusive rights to use the "Nescafe" and "เนสกาแฟ" trademarks within the kingdom. The battle is far from over though. Nestlé seeks 577 million baht in damages due to an eight-day suspension of Nescafe sales—a temporary injunction that stems from the alleged infringement of trademark rights by the Mahagitsiris.
Peacemaking efforts between the parties failed in the mediation session, leading to a full-blown trial. The court has scheduled the next hearing for June 9, 2025. An international arbitration tribunal previously verified Nestlé's right to terminate a 12-year contract with QCP, a joint venture between Nestlé and the Mahagitsiri family, which resulted in the termination of the agreement and subsequent legal skirmish.
QCP, which produced Nescafe products in Thailand from 1990 to 2024, reacted by filing a lawsuit against Nestlé in an attempt to maintain production, distribution, and import of Nescafe in Thailand. Hoping to cover all their bets, Nestlé also requested the court to appoint a liquidator to manage QCP's finances and protect the company's assets.
The Mahagitsiri family holds no ownership of the Nescafe brand or the production technology; these assets remain under Nestlé's control. In the interim, Nestlé Japan has been producing Nescafe in Thailand for local distribution.
Remarkably, despite the ongoing legal brouhaha, Nestlé has pledged to minimise any impact on stakeholders, assuring that its commitment to purchasing Robusta coffee beans in Thailand remains unshaken. The coffee conglomerate also plans to continue investing in local Nescafe production efforts in the kingdom.
Enrichment Data:
Case Background
- Trademark Dispute: The dispute centers on alleged trademark infringement related to the Nescafé brand. Nestlé, the owner of the Nescafé trademark, claims that Prayudh Mahagitsiri and Chalermchai Mahagitsiri have infringed on its rights to the brand in Thailand[1][2][3].
- Financial Claims: Nestlé is seeking damages of 577 million baht due to an eight-day suspension of Nescafé sales[2][4].
Current Status
- Recent Developments: A mediation session was held on May 28, 2025, at the Central Intellectual Property and International Trade Court, but no agreement was reached between the parties[1][4].
- Court Rulings: The Central Intellectual Property and International Trade Court has reaffirmed Nestlé Thailand's exclusive rights to use the "Nescafé" and "เนสกาแฟ" trademarks in Thailand[2][4].
- Upcoming Trial: The next hearing is scheduled for June 9, 2025, as part of the formal trial process[1][4].
Background on the Joint Venture
- Quality Coffee Products Ltd (QCP): The dispute also involves the dissolution of QCP, a 50/50 joint venture between Nestlé and the Mahagitsiri family. Nestlé filed a petition on March 14, 2025, to dissolve QCP, citing stalled decision-making due to disagreements[4].
This legal squabble underscores the complexities of trademark disputes and the intricacies of business partnerships in Thailand.
- The ongoing legal dispute between Nestlé and the Mahagitsiri family over the Nescafe business in Thailand highlights the intersection of politics, business, and international trade.
- In the arena of finance and investing, Nestlé seeks 577 million baht in damages from the Mahagitsiris, stemming from an alleged trademark infringement that led to an eight-day suspension of Nescafe sales.
- The economy is affected as Nestlé's legal battle with the Mahagitsiri family threatens the production, distribution, and import of Nescafe in Thailand, with QCP, a former joint venture between Nestlé and the Mahagitsiri family, filing a lawsuit to maintain its activities.
- Technology plays a role in the dispute as Nestlé holds the production technology and control over the Nescafe brand, while Nestlé Japan is currently producing Nescafe in Thailand for local distribution.
- Amidst this real-estate battle for control of the Nescafe business in Thailand, Nestlé has reassured stakeholders that it remains committed to continuing its investments in local Nescafe production efforts.
