Zespri hails court victory against grower who took plants to China

The High Court awarded Zespri $15 million in damages
The High Court awarded Zespri $15 million in damages Photo credit: Getty

Zespri says the success of its court action against a grower who unlawfully took kiwifruit plants to China is an important decision for the wider New Zealand horticulture sector.

Civil action was launched in 2018 against kiwifruit grower Haoyu Gao, his wife Xia Xue and their company Smiling Face Limited after Zespri discovered that two of Zespri's protected kiwifruit varieties had been taken from New Zealand to China and propagated by Gao and his associates.

The High Court awarded Zespri $15 million in damages and found that Gao had fraudulently offered to sell Zespri's varieties as well as the right to licence them to parties in China, which was exclusively retained by Zespri.

It also found that he facilitated the planting of Zespri's varieties on Chinese orchards and breached his contractual obligation to notify Zespri of any infringement that they were aware of.

"This is an important decision for New Zealand's kiwifruit growers, as well as for other New Zealand horticultural businesses, giving them the confidence that if they continue to invest in research and development to create value for New Zealand they will have protections against those who seek to undermine that," said Zespri's chief grower and alliances officer Dave Courtney.

He said Gao's actions, along with those of his associates, put at risk the livelihoods of New Zealand's 2,800 growers, directly contributing to the unauthorised spread of Zespri's SunGold Kiwifruit in China.

"Zespri has been investigating the spread of unauthorised plantings of its varieties in China and has identified parties associated with Mr Gao, as well as others who were involved in the establishment of SunGold in China and who knowingly misled Chinese investors and growers to plant Zespri's varieties without authorisation."

The Chinese Government has strong Plant Variety Right legislation which it is in the process of strengthening further, alongside enforcement provisions.

"We're very encouraged by that, as well as by China's broader commitment and efforts to clamp down on other types of intellectual property infringement in China and we hope to work alongside Chinese officials to strengthen the protections of investors and IP holders further."

Zespri would now consider its options in China in relation to Gao and his associates, as well as seek to collect the damages awarded.