As part of the settlement agreement reached on February 11, 2015, Frito-Lay agreed to respect Clear Lam’s patent rights and said it will continue to work with the company.
Clear Lam accused Frito-Lay of stealing its design
In the original lawsuit filed in Federal Court in Chicago on September 18, 2014, Clear Lam accused Frito-Lay of stealing its design for promotional boxes of its Doritos sold alongside Microsoft's Xbox One console.
A spokesman for Clear Lam told FoodProductionDaily specific terms of the settlement agreement are not being disclosed but PrimaPak includes a commercially viable method of producing a first-of-its-kind cubed, flexible, recloseable package.
The PrimaPak system is produced from rollstock on custom vertical form-fill-seal (VFFS) equipment and is designed to replace traditional stand-up pouches, bags, and preformed rigid containers such as plastic jars, cans, bottles, and trays.
As part of the hearing, Clear Lam said its proprietary [shaping] technology is the product of several years of confidential research and development.
It said it made some specifications of the lighter, more transportable and stackable packaging available to Frito-Lay in the hope it could secure a contract with the snack wholesaler. The talks began in 2008, according to the lawsuit, and continued during 2010 and beyond.
“The 2008 Confidentiality Agreement terminated by its own terms on January 1, 2011, but Frito-Lay’s confidentiality and non-use obligations were not affected by the termination of the agreement,” the suit states.
“After the 2008 Confidentiality Agreement terminated, Frito-Lay continued to seek confidential and proprietary trade secret information from Clear Lam under the guise of evaluating whether to buy the right to use the PrimaPak technology.”
Clear Lam claimed at the time, it sought and obtained another confidentiality agreement with Frito-Lay in 2011. As was the case with the first, it stipulated Frito-Lay could only use the confidential information for the purpose of evaluating whether it would enter into a contract with Clear Lam to use the technology.
Clear Lam said it learned of the ‘Gamer Pack’ promotion in October 2013 and that Frito-Lay claimed the technology was its own.
Frito-Lay faced allegations of violating the 2008 and 2011 confidentiality agreements, false advertising under the Lanham Act and violating the Illinois Trade Secrets Act.
Clear Lam Innovation Center
Clear Lam announced it had made significant investments in its PrimaPak System last year and said it will open a 25,000-square-foot Co-Packing Facility and Innovation Center at its Elk Grove Village manufacturing operation near Chicago in spring 2015.
It claims it has invested $2m in equipment and technology to launch the operation, which will support consumer products using its patented PrimaPak System.
The operation will employ 23 staff and produce PrimaPak packaging for test markets, regional rollouts, seasonal items and ongoing national distribution.
The Co-Packing Facility will specialize in dry, free-flowing products using PrimaPak Vertical Form-Fill-Seal (VFFS) System with combination scale weigher. It will start with two production lines with a combined production capacity of 20 million units per year. Additional lines will be added in the future.
Clear Lam also will assist on an as-needed basis with the sourcing and purchasing of raw materials; shipping, freight and logistic services; and inventory and warehouse storage of materials and findings.
The facility can handle small-batch test product runs and long-term packaging needs. Applications include salty snacks, nuts, candy, dried fruit and cereals.