Posted on: Sunday, June 29, 2003
Chocolate maker resurfaces
By Andrew Gomes
Advertiser Staff Writer
|An official with the state Agriculture Department said a statement accompanying Sobe chocolate bars doesn't appear to violate made-in-Hawai'i laws because it's ambiguous about origins of the contents.
Deborah Booker The Honolulu Advertiser
Hawaiian Vintage Chocolate Co., a publicly traded firm headed by Jim Walsh, is producing chocolate for HVC Lizard Chocolate LLC, a company based in Norwalk, Conn., that Walsh formed last August to roll out SoBe chocolate bars through 7-Eleven stores nationwide.
Despite the major-league partnerships and potentially huge supply market for Hawaiian Vintage, the company has kept a low profile in recent years after disclosing that it lost its local cacao crop a setback that troubled some investors, customers and state officials.
Walsh and representatives of Norwalk-based SoBe creator South Beach Beverage Co., which PepsiCo. acquired for $337 million in 2001, did not respond to repeated requests for an interview, including calls to SoBe representatives and messages left for Walsh at HVC Lizard last week.
It appears Walsh has found a new start with strong corporate partners, but not all the troubles of Hawaiian Vintage are gone, as a few lawsuits drag on against the company.
It was unclear how much of a presence Hawaiian Vintage maintains in the state. The company, which sells chocolate and coffee through a Web site, maintains a local voice mailbox but has no known brick-and-mortar address. According to the state Department of Commerce & Consumer Affairs, Hawaiian Vintage is an active Honolulu-based company.
The SoBe chocolate bars also make reference to Hawaiian Vintage Chocolate and "warm Pacific trade winds that ... caress our cocoa plants to voluptuous maturity."
It could not be verified whether Hawaiian Vintage has trees in Hawai'i that produce cacao, the bean-like seeds used to make cocoa and chocolate.
The Hawai'i Agricultural Statistics Service, which compiles local crop data, said it does not know of any local cacao used by Hawaiian Vintage.
Bill Pierpont, manager of the state Agriculture Department's measurement standards program, also said he was unaware of Hawaiian Vintage chocolate with local origin, though he said the SoBe chocolate statement referencing Hawai'i trade winds caressing cocoa plants doesn't appear to violate made-in-Hawai'i laws.
"It is ambiguous enough to not say it does or doesn't contain a product of Hawai'i," Pierpont said.
HVC Lizard licensed the SoBe name and formed a "chocolate partnership" with Hawaiian Vintage to make SoBe chocolates infused with ginseng, creatine, amino acids and minerals.
Marketed as "chocolate with attitude," four SoBe chocolate bars Drive, Power, Tsunami and Energy were unveiled in October at a national convenience-store product show in Florida. The chocolate was sold exclusively at 7-Eleven through December, then made available for general distribution in January at a suggested retail price of $1.29.
HVC Lizard, which has about 220 employees according to a story that ran earlier this month in The Advocate daily newspaper in Stamford, Conn., came out last month with another chocolate bar, a carbohydrate-free product called Z-Carb.
Walsh, according to The Advocate, said the SoBe and Z-Carb bars would be sold in 45,000 stores by July. According to a May article in trade publication Brandweek, Walsh planned to have a $6 million advertising campaign with celebrity endorsers in gear by August.
In Hawai'i, two varieties of the SoBe chocolate bars could be found at several of the state's roughly 40 7-Eleven stores. Hawaiian Vintage also sells its own line of chocolate on the Internet.
Padovani's Restaurant & Wine Bar in Waikiki distributes Hawaiian Vintage-brand chocolate locally, and uses some of the chocolate in its desserts and handmade candies. Other restaurants, including Indigo Eurasian Cuisine and Alan Wong's, which had supported Hawaiian Vintage, have stopped using the chocolate.
Hawaiian Vintage also has lost significant support from investors, as the company's stock, which reached an all-time high of $4 a share in May 1998, dropped to an all-time low of 3 cents a share in August 2001 and since has generally traded around 10 cents a share.
The company's stock, which is not listed on a major exchange but is traded by brokers, closed Friday at 11 cents a share.
One Hawaiian Vintage investor, an Oklahoma family partnership, sued the chocolate producer last October in Hawai'i Circuit Court to recover three $25,000 loan-like investments made in 1994 and 1996. The suit said the $75,000 debt with interest grew to about $175,000 as of last September.
Plaintiff Alexa Fioroni last month obtained a ruling validating her complaint after Hawaiian Vintage did not respond although it was notified of the suit through an agent. Fioroni attorney Brandon Davidson would not discuss the case, which has not resulted in a judgment.
Other recent lawsuits against Hawaiian Vintage one filed to collect $20,000 in unpaid rent at the downtown Honolulu high-rise Harbor Court, and another for $1,100 for insurance company goods and services, ran into problems notifying Hawaiian Vintage of their cases.
According to the rent lawsuit filed by Ahi Harbor LP, discussions with Walsh via e-mail did not result in a settlement. Ahi's attorney said a judgment is being pursued.
Walsh is a former marketing executive from Chicago who incorporated Hawaiian Vintage in 1993, after a chance meeting with a Hershey Chocolate Co. executive inspired Walsh to move to Hawai'i in 1986, research cacao and establish a crop.
Hawaiian Vintage in 1994 released its first commercial product derived from Big Island cacao orchards and manufactured on the Mainland. The company planted additional trees in 1997, but the plantings died and orchards changed ownership, leaving it with little to no local cacao.
Foreign cacao substitutions began in 1997, though Hawaiian Vintage for four years continued to identify its chocolate as a Hawai'i product, leading to a state Department of Agriculture demand for the company to change its product labels.
Walsh said he always maintained a high-quality chocolate, and in 2000 said he intended to replant cacao in Hawai'i and concentrate on creating herb-infused chocolates that promote enhanced strength, weight loss and other benefits.
Reach Andrew Gomes at email@example.com or 525-8065.