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Danone-owned milk formula maker considers legal action vs. Fonterra

The Fonterra logo is seen near the Fonterra Te Rapa plant near Hamilton August 6, 2013. REUTERS/Nigel Marple
The Fonterra logo is seen near the Fonterra Te Rapa plant near Hamilton August 6, 2013. REUTERS/Nigel Marple

WELLINGTON (Reuters) - A Danone SA unit said on Thursday it was considering legal action against New Zealand's Fonterra after the maker of Karicare milk formula had to recall products due to incorrect tests that led to global food safety scare.

Initial tests prompted Fonterra to warn early this month that whey protein used in the products contained a bacteria which may cause botulism. Subsequent testing by New Zealand's Ministry of Primary Industries showed a different strain of the bacteria which posed no safety threat.

The contamination scare prompted product recalls in nine countries, including those by the Danone unit, Nutricia.

"We are considering our legal position," Corine Tap, general manager of Nutricia ANZ, told reporters when asked whether the company would take legal action against Fonterra and the New Zealand laboratory which performed the incorrect tests.

"There are more countries involved in this situation and we are considering our position at the moment," she said, adding that she did not have any figures on the damages Nutricia suffered as a result of the recall.

Nutricia ordered a recall of 67,000 tins of infant formula in New Zealand. Nutricia said its own tests completed over the last week also showed a negative result for clostridium botulinum, the bacteria in question.

Fonterra said on Wednesday it "did the right thing" in announcing the possible risk at the start of the month, while acknowledging that its reputation had taken a knock as a result of the initial disclosure.

(Reporting by Naomi Tajitsu; Editing by Edwina Gibbs)

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