10/01/2014 09:37 EDT | Updated 12/01/2014 05:59 EST

Keurig coffee sued for $600M by Ontario-based Club Coffee

An Ontario coffee roaster and grinder is suing Keurig for anti-competive behaviour, claiming it is keeping the price of single-serve coffee pods artificially high for consumers.

Club Coffee`s $600-million lawsuit against coffee giant Keurig Green Mountain alleges the U.S. chain is flouting the rules to maintain a near monopoly and keep single-serve coffee prices artificially high.

"First, their new brewers have what they claim to be “proprietary technology” that rejects any single serve pods not authorized by them," a spokesperson for the company told CBC News in an email. "Secondly, Keurig has used the threat of this lockout technology to coerce retailers into exclusive arrangements to sell only Keurig-controlled products."

Requests for comment from Keurig Green Mountain were not immediately returned on Wednesday.

Keurig controls about 90 per cent of the burgeoning market for single-serve coffee pods, often called K-cups. Keurig recently increased the retail price of its pods by about nine per cent, citing higher coffee prices on the wholesale market

Club Coffee says the company's practices harm not only other companies, but also consumers, who are paying higher prices than they should otherwise be.

Unlike Keurig's pods, Club Coffee manufactures something it calls a "soft pod," which it says makes coffee without the use of a plastic cup. The company is also bringing a fully compostable coffee pod to market imminently that uses bio resins instead of plastics.