Tennessee-based Standard Candy Co claims it had been forced by a former private label client to include omega-3 DHA (docosahexaenoic acid) into the products it manufactured under the client’s label.
Standard Candy, best known for its own product Goo Goo Clusters, last week filed suit against Deleware’s NutraBella, alleging that its former client refused to pay invoices for a batch of DHA-fortified products that had ended up with a fishy taste.
NutraBella sells nutritional products specifically designed for women and expectant mothers. The lawsuit, filed in Nashville’s US District Court, maintains that NutraBella decided to begin adding DHA to the products manufactured for it by Standard Candy.
DHA is a long chain omega-3 essential fatty acid, derived from fish or algae, and is thought to support fetal brain and eye development during pregnancy.
However, fortification with the ingredient has traditionally posed formulation challenges due to the fishy taste that it can deliver.
According to Standard Candy’s suit, the company had initially refused to manufacture the DHA-fortified goods on the grounds that “its experience with the use of DHA was negative”.
The suit goes on to allege that NutraBella obtained its own manufacturing criteria for the introduction of DHA into the products, and developed the process and formula in collaboration with an external consultant. NutraBella was then “insistent” that the products be manufactured by Standard Candy according to the new formula, and agreed to take the risk of negative outcomes, says the suit.
Standard Candy said it followed “at all times” the formulae, procedures and instructions provided by its client. However, one batch of the product, manufactured in June 2008, had a fishy taste and was unsaleable.
According to the suit, NutraBella paid for the invoice of the corrupted batch, but later refused to pay a further invoice for $40,500 claiming a set off for losses and damages due to the unsaleable product.
In addition, Standard Candy had purchased ingredients worth around $52,000, which it was unable to use in other applications.
The company’s lawsuit requests payment of just over $92,000 plus interest, in amounts due.
NutraIngredients-USA.com did not receive comments from NutraBella prior to publication this morning.
However, leading algal DHA supplier Martek Biosciences later confirmed that it had supplied the ingredient in question, but said that NutraBella had subsequently gone on to successfully manufacture its product with Martek's ingredient, and that the DHA-fortified nutrition bar remains a "successful and popular product".
"Unfortunately, some third party manufacturers do not have the experience or resources to properly handle and formulate DHA, which has specific requirements. Martek likes to work as a partner with our customers on the formulation process and we find that in some of the instances we are not given this opportunity by the third party manufacturer, problems sometimes arise," said spokesperson Cassandra France-Kelly.
Non fishy solutions
The fishy taste in omega-3 fortified goods occurs due to the oxidation of the fatty acids - both fish derived and algae-derived. Because the oil is highly susceptible to oxidation, it has traditionally been difficult to incorporate into food and beverage formulations.
However, ingredient and food manufacturers have successfully sought ways to overcome these stability issues in recent years, which has resulted in more and more omega-3-fortified products appearing on the market.
For example, Ocean Nutrition, which is one of the leading North American fish-oil suppliers, has developed a micro-encapsulation technology that protects oil from oxidation. The company, which uses the Powder-loc technology on over 95 percent of its food ingredient sales, has seen its branded Meg-3 omega-3 appear in over 30 food applications, including dairy, confectionery, beverage and baked goods.
Martek, the leading global algal DHA supplier, markets its ingredient as a fish-free source of omega-3, particularly suitable for products targeting infants and children. The branded life’sDHA is used in 99 percent of US infant formula.
Globally, more than 3,000 omega-3 products have been launched worldwide in the past five years. And according to a report published last year by Packaged Facts, omega-3 enriched foods make up the strongest sector of the functional foods market in the US, growing from $100m to more than $2bn in four years. The firm predicts this category will reach $7bn in sales by 2011.
This article was modified on April 23, 2009 to include comments received from Martek Biosciences.