Sanchez says it's retaliation: Frenchman sues vice guv over business deal

Cebu Vice Governor Gregorio Sanchez is named respondent in a complaint for swindling and other deceits filed by his former business associate before the Makati City prosecutors' office for claiming that he is the inventor and owner of Lacto Pafi products.

A case that the provincial official calls as a retaliatory act against him by somebody who doesn't know what he is talking about.

Charles L. Zani, a French national and chairman of Upright Marketing Solutions Incorporated, claimed that Sanchez - through his Lacto Bacillus Pafi Techno Resources Corporation - is not the original inventor and owner of microorganism it referred to as Lactobacillus Pafi Plantarum.

The vice governor, as chairman and president of his family-owned corporation, had previously entered into a memorandum of agreement with Ronaldo Adiao representing Zani's distribution firm for the exclusive marketing, distribution, sale and promotion of all Lactobacillus products.

Based on the MOA they have signed in 2003, Upright Marketing Solutions Incorporated would be the sole and exclusive marketing arm of Lacto Bacillus Pafi Techno Resources Corporation for the sales and distribution of its soya fermented drink products carrying the brand names Lactovita, Lactoprima, Lactogold, Lactovilate, Lactoviva and Lactovive.

The Lactobacillus Pafi products became popular, not only in Cebu and other parts of the country, but also in other countries like Norway, Russia, South Africa, Australia and Thailand when many persons who used them claimed to have been cured from their illnesses. This is the reason that prompted Zani to enter into a business venture with Sanchez.

Lactobacillus is a genus of gram-positive facultative anaerobe bacteria. They are a major part of the lactic acid bacteria group, named as such because most of its members convert lactose and other simple sugars to lactic acid.

Some species of lactobacillus are used industrially for the production of yogurt, sauerkraut, pickles and other fermented food.

The MOA entered into by Sanchez and Upright Marketing was that Zani's company would grant Lacto Pafi an advance amount that will be liquidated or settled in the form of rebates using a fixed amount per bottle purchased, until such time the amount advanced to Sanchez would be fully liquidated.

But the business ties between Sanchez and Zani's distribution firm soured after the French national found out that Sanchez is not the real inventor and owner of the fermented drinks.

Zani learned that the Bureau of Food and Drugs on November 20, 2001 had already granted a license to operate to Pagpalambo Foundation, Inc. - not to Lacto Pafi Techno Resources Corporation - to manufacture and sale of such kind of drinks registered as "Lactopafi Soya Fermended Drinks."

According to Zani, because of Sanchez's "false representation," his company had spent more than P10 million in expenses for the sale, promotion and marketing of Lacto Pafi products."

When sought for comment, Sanchez said Zani does not know what he is talking about because he doesn't know the history of Lactopafi.

Sanchez said Pagpalambo Foundation, Inc. used to be owned by their family just like Lactopafi. It was learned that Sanchez left Pagpalambo Foundation and formed his family-owned corporation.

The vice governor said, the filing of a complaint against him was made by Zani only to retaliate because he was the one who first filed a case against the foreigner.

Sanchez explained the actuation of Zani was understandable, saying it stemmed from a lawsuit he earlier filed against the latter for rescission of contract.

"I feel so sorry for him. He does not know everything about Pagpalambo and Lactopafi. He's just telling a lie," Sanchez said. - with reports from Cristina Birondo/NLQ