Zuru Diaper Dispute Heats Up with Surprising Testimony

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A surprising witness in the High Court at Auckland’s ongoing Zuru diaper dispute has revealed that a defendant allegedly admitted to receiving an “inside scoop” on the nappy trade. Michael Wilson, a marketing professional from Smart Media, took the stand today for the plaintiffs, after reading a recent article and realizing that a business dispute he had in 2023 was directly connected to the defendant in this high-profile case.

The case, which has been in the courts since 2021, involves Zuru taking legal action against the Taylor family, their former partners in the Rascals nappy business, and JJK Group, a consortium of businessmen including Jarrod Armitage, Jason Collie, and former Tall Black Kirk Penney. The group had acquired the struggling nappy brand Treasures in late 2020.

Zuru alleges that Grant Taylor breached restraint of trade provisions when selling his family’s share of Rascals to Zuru in 2020 for $30 million. The company further claims that Taylor provided JJK with confidential information that enabled the group to acquire the competing Treasures brand.

Zuru settled with Grant Taylor and his father, Keith Taylor, on the eve of the trial, with the Taylors paying Zuru $1 million. This left JJK as the sole remaining defendant. In response, JJK has launched a counterclaim, alleging that Zuru interfered in its commercial relationship with Woolworths.

During the court proceedings today, it was revealed that Zuru is seeking compensation and damages exceeding $75 million, stemming from being outbid by JJK. Zuru had initially offered $200,000 for the Treasures brand, which was ultimately topped by JJK’s $300,000 offer.

Wilson testified that he had attempted to work with JJK in 2023 to rebrand Treasures after connecting with Armitage through Pastor Andrew Robertson of Harvest World Church. He recounted a walk-and-talk with Armitage during which the budding nappy manufacturer allegedly told him that he had received an “inside scoop” on the nappy trade from a man he later identified as “Grant.”

Wilson claimed that the information included profit and loss statements, revenue sheets, and details about the markets in which Rascals — a commercial rival — was involved. However, during cross-examination, JJK’s lawyer, Sam Lowery, questioned Wilson’s credibility, pointing out inconsistencies in his testimony and highlighting past actions that cast doubt on his reliability.

Lowery walked Wilson through his pitch for business with JJK, including an email in which Wilson claimed drug use was rife in the marketing industry. Emails also showed Wilson had boasted about his role in Smart Media losing a major client.

The relationship between JJK and Smart Media quickly deteriorated, with Smart Media issuing a $33,200 invoice for completed work that was ultimately not paid. Lowery further probed Wilson’s past, including a prosecution for impersonating a police officer in a dispute over an investment property in Queenstown. Wilson stated that the conviction was later appealed and he was granted a discharge without conviction.

Lowery also pointed out that Wilson had recently used a false name when contacting a private investigator working for JJK, who was looking into Wilson’s background. In a five-minute call played in full to the court, Wilson referred to himself as “Michael Adley” and claimed that he “always had a good reputation in the industry.”

Lowery repeatedly suggested that Wilson had only contacted Zuru and offered evidence to “get favor with a big business and a very wealthy family” and to “get a moment in the spotlight.” Wilson denied these motivations, stating that his actions were purely in the interest of justice.

Justice Dani Gardiner suppressed part of Wilson’s evidence after Lowery raised concerns that it was false and defamatory. The case continues to unfold, with both sides presenting their arguments in what is shaping up to be one of the most high-stakes legal battles in New Zealand’s business history.

Opinion: The Zuru case has become a litmus test for corporate integrity and the legal system's ability to handle complex commercial disputes. As the trial progresses, it is crucial that the court remains focused on the facts and not the theatrics of the courtroom.