Match and Mismatch: The Wahaha- Danone Dispute

This case examines the legal dispute between China's leading beverage company, Wahaha Group, and the French beverage giant, Groupe Danone. Danone and Wahaha formed a strategic JV partnership in 1996. Over the next decade, both companies profited from the JV. Wahaha joined the global top 5 beverage companies and Danone gained a strong foothold in China. Despite all their success, however, Danone and Wahaha were trapped in a complex and thorny relationship. A series of legal battles accompanied by high profile media wars broke out in 2007. The initial trademark transfer dispute escalated into fights about foreign monopoly, local protectionism and national economic security, which led the presidents of both countries to ask each party to find an amicable solution. The case leads students to consider that in order to do business successfully in China, multinationals must align their interests with their Chinese counterparts rather than challenge or compete with them. This is especially important in a business environment like China where legal protection is weak.