Heinz threatens to sue Dick Smith

Multinational Heinz is threatening to sue Australian businessman Dick Smith over claims made on his company's beetroot tins, AAP reports.

Heinz says the wording of a label on Mr Smith's "Magnificent Sliced Beetroot" constitutes "injurious falsehood" and is demanding Mr Smith re-label them or face action.

The label reads, "When American-owned Heinz decided to move its beetroot processing facility from Australia to New Zealand causing hundreds of lost jobs, we decided enough is enough. So we are fighting back against poor quality imported product."

Heinz has written a letter to Mr Smith, pointing out the job losses when Heinz moved to New Zealand were minimal and that its products produced there are of a high quality.

Mr Smith says he stands by the comments on the label but is worried about the potential cost of the legal action.

"They're only doing this because we're taking up their market share. Most people don't look at the label; they just know our stuff is better quality,” Mr Smith told AAP.