Thursday, August 13, 2009

What sweetens a legend most?

Kremers v. The Coca-Cola Co., 2009 WL 2365613 (S.D. Ill.)

Plaintiffs sued for consumer fraud as putative class representatives, and Coca-Cola removed to federal court. They alleged that Coca-Cola markets Coke using the terms “classic” and “original formula,” but Coke is currently sweetened with high fructose corn syrup (HFCS), not sucrose from sugar cane or sugar beets, as was true from 1886 until about 1980.

In 1980, cost drove Coca-Cola to switch to HFCS. In 1985 came the New Coke disaster and subsequent resumption of pre-New Coke Coke, now labeled as “Classic” or “original formula.”

Plaintiffs moved for partial summary judgment on the meaning of “classic” or “original formula,” which Coca-Cola argued had no unitary meaning. The court agreed with the parties that the terms were not mere puffery. Rather, they served a key purpose: differentiating Classic Coke from the reviled New Coke. “From here on out, however, matters grow decidedly more murky.” (Insert your own beverage joke here.) The court found plaintiffs’ argument that classic/original formula could only mean sucrose-sweetened implausible, because from 1980 to 1985 Coke was sweetened with HFCS. Nor could the court endorse Coca-Cola’s argument that classic/original formula had no popularly-understood meaning; as Coca-Cola itself recognized, those terms are widely understood to denote the pre-1985 formula.

The court dropped a footnote on the true “original” formula, flavored with the leaves of the coca leaf plant, but noted that it was unlikely that anyone would expect that formula.

Analogizing to the similarly worded Lanham Act, the court found that the meaning of an ad for purposes of a false advertising claim is a question of fact. Punt to the trier of fact! Cross-motions for summary judgment denied.

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