Gisborne Milk Co-op, the 66-year-old Bay of Plenty dairy supplier in liquidation, has lost a last-ditch bid to get back shares and supply arrangements with Fonterra Cooperative Group.
In the High Court in Auckland, Justice Rebecca Ellis turned down Gisborne Milk's claim that Fonterra breached its empowering legislation, saying the Bay of Plenty firm made its own commercial decisions to surrender shares in the cooperative. The Dec. 17 judgment was published on the Justice Ministry's website this week.
"It is difficult not to think of the shareholders Gisborne Milk as sailors caught in a perfect storm," Justice Ellis said. "It is impossible not to have considerable sympathy for them. But none of their claims can succeed."
Gisborne Milk was seeking reinstatement of its Fonterra shares and an inquiry into damages, saying Fonterra's hardball negotiations and stance on whether the company could be a shareholder fell afoul of the Dairy Industry Restructuring Act and constituted misleading conduct.
Fonterra inherited Gisborne Milk as a supplier from the company's relationship with Bay Milk when Parliament legislated to create a national dairy group.