‘Very satisfied with the outcome’: A2 Milk and Lion settle duelling lawsuits over health claims

A2 MILK has avoided having its health claims tested in court for the second time after settling a legal dispute with drinks giant Lion.

Yummy yummy I’ve got A2 in my tummy. Picture: Tracey Nearmy/AAP

NEW Zealand dairy giant A2 has avoided spilling its milky secrets in court for the second time after settling a legal battle with Lion Dairy & Drinks.

The A2 Milk Company announced on Thursday it was ending the bitter dispute, which kicked off last September when A2 sued its rival over a yellow strip added to its Pura and Dairy Farmers labelling which read, “Naturally contains A2 protein.”

Lion was attempting to head off competition from its rapidly growing competitor. A2 claims its milk — which contains only the A2 protein, unlike regular milk which contains both A1 and A2 proteins — is easier on sensitive stomachs.

A2 Milk alleged Lion was misleading consumers by claiming to sell an “A2 product” when its milk still contained A1 protein. In response, Lion countersued, alleging A2 Milk’s health claims were unfounded.

A2 sued Lion over the yellow ‘A2’ strip.

“The A2 Milk Company Limited is pleased to advise that a settlement has been reached in respect of the legal dispute with Lion Dairy & Drinks Pty Limited,” an A2 Milk spokesman said.

In a joint statement, the companies said they had “mutually agreed not to proceed with their cases against each other”.

“The terms of the settlement are confidential,” it said. “The parties are very satisfied with the outcome and will remain focused on building and maintaining the strength of their individual brands.”

The parties were scheduled to battle it out in court in November but after months of behind-the-scenes negotiation the deal was signed on Wednesday. News.com.au understands under the terms of the settlement, Lion has agreed to remove the yellow “A2” strip from its labelling. Lion declined to comment further.

It marks the second time A2 has avoided having its health claims tested in court. In 2015, the company settled a lawsuit against the ABC over a segment on The Checkout which said the “jury is still out on whether A2 Milk helps digestion and there is no concrete evidence A1 has any negative effects”.

In July, analysts at Macquarie listed the Lion lawsuit as one of three key risks facing A2 Milk. “The onus is on Lion to prove there is insufficient evidence in the science around the A2 protein proposition,” they wrote.

“The scientific evidence in support of the benefits of A2 Milk continues to strengthen and A2MC is confident in its position.”

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