Unilever PLC, the famous consumer goods giant, announced on Thursday that it was dropping a mislabelling lawsuit against San Francisco-based food startup Hampton Creek Foods.
"Unilever has decided to withdraw its lawsuit against Hampton Creek so that Hampton Creek can address its label directly with industry groups and appropriate regulatory authorities," Mike Faherty, Vice President for Foods of Unilever North America, said in a statement.
Though Unilever didn't specify why it dropped the lawsuit, Hamptons Creek CEO said that it was probably because Unilever realized, "It's not the company they are or the company they want to be," according to Forbes.
Unilever sued Hampton Creek last month over its egg-free "Just Mayo" mayonnaise alleging that the company mislabelled its product. It asserted that a major ingredient in Mayonnaise is egg and that Hampton Creek was misleading its customers.
"By calling its vegan sandwich spread 'Just Mayo,' Hampton Creek falsely communicates to consumers that Just Mayo is mayonnaise, when it in fact, it is not," the lawsuit alleged.
However, the world questioned Unilever's lawsuit over such a small issue. The case didn't just provide free press to Hampton Creek but also saw many arguments against Unilever's stand in the lawsuit.
Hampton Creek CEO Josh Tetrick said that it was surprising that such a big company would sue over such a silly issue. He also predicted that Unilever would drop its lawsuit soon, and that eventually came true, reports Forbes.
"Hampton Creek was founded to open our eyes to the problems the world faces. This moment has only validated why," Tetrick said in response to Unilever's statement.
Hampton Creek specialises in making Vegan products and eliminating the use of egg in condiments. The company uses new technology to take the best out of plants and make food better. But CEO Tetrick acknowledges that the same technology scares away several potential buyers.
"We are not doing synthetic engineering. We are not manipulating genes. We are screening through plants in a way that is novel and using them to make food better," Tetrick was quoted by The Financial Times.
Thursday bore good news for the Bill Gates-backed food startup. Hampton Creek announced that it had raised $90 million in a new round of funding. The capital valued the company at $500 million.