A contracted manufacturer has been found in violation of an existing contract and is being forced to pay damages, according to local business sources. Florida residents may be aware of Natrol, a company famous for producing nutritional supplements, and Nature's Products, Inc., one of several companies contracted to make their products. Natrol accused NPI of breach of contract and has been awarded a settlement by a U.S. District Court judge.
The case was precipitated by a nationwide recall of a protein powder sold by Natrol after the FDA realized the products contained wheat and gluten. This was contrary to the information on the label, and considering the prevalence of both wheat and gluten allergies in the United States, the FDA was forced to order a recall. A trial was called to determine fault in this matter, which cost Natrol a considerable sum.
After a jury trial, it was ruled that NPI was guilty of breaching their contract with Natrol, as well as breaching rules related to express and implied warranty. The court awarded a settlement of $3.27 million, though NPI countersued and won back $750,000 for unpaid invoices related to the case. Ultimately, however, the onus was found to be on NPI for manufacturing a defective product.
This breach of contract had potentially lethal implications for consumers in Florida and elsewhere in the country. This is partly why it is so important for business owners of any stripe to stick to their contracts -- sometimes, it is about more than money. Any breach of contract should be brought into question in a legal capacity in order for it to be settled quickly and efficiently.
Source: South Florida Business Journal, Sunrise manufacturer loses split decision in mislabeled protein powder case, No author, Oct. 25, 2013