Theft of Yogurt Trade Secret Alleged in Chobani Ownership Dispute

The former wife of billionaire Chobani, Inc. CEO Hamdi Ulukaya has alleged
that he “boasted on occasions that he had obtained the formula for the
Chobani brand of yogurt from [competitor] Fage by bribing a former
employee of Fage. He traveled to Europe and bribed this individual with
30,000 Euros.” Giray v. Ulukaya, No. 652838-2012 (N.Y. Sup. Ct., N.Y. Cty.,
memorandum filed April 3, 2014). She made the allegation in a memorandum
of law filed in support of her motion for injunctive relief in litigation seeking
a determination that she is a 53 percent shareholder in defendant Euphrates,
Inc., the assets of which, she claims, were used to create Chobani.

Plaintiff Ayse Giray, a New York physician, also claims that she financed the
formation of Euphrates “and is merely claiming what was acknowledged by
defendants in writing. The yogurt was based upon a recipe he stole from a
competitor, Fage. He defrauded his angel investors by selling in excess of
100% of the shares of Euphrates in addition to his own. Each of them had to
sue him to enforce their agreements or at least get their money back. He lied
to his banks and the USDA by misrepresenting his assets and by concealing
the true ownership of Euphrates to avoid the need for a personal guarantee.
He kept the factories’ doors open by reducing expenses through tax fraud
and bypassing sewage meters.” Giray seeks an order enjoining the defendants
from taking any action diminishing her rights and compelling them to
provide her with all agreements “in connection with the prospective sale of
any interest in Chobani or Euphrates which would dilute, adversely affect or
diminish Plaintiff’s shareholder interest.”

The court has reportedly refused to issue a temporary restraining order.
Bloomberg Businessweek, April 4, 2014.

Issue 520