Coke and ABA Facing Legal Challenges in Federal Court
Public health advocates’ campaigns against the soda business — particularly the Coca-Cola Company — spilled over into the courtroom last week in the form of two recent cases involving the world’s largest beverage company.
In a move that some experts have described as similar in strategy to the legal actions taken against the tobacco industry in the 1990s, a new lawsuit accuses Coke and CSD-friendly trade group American Beverage Association (ABA) of engaging in a 40-year “elaborate campaign of disinformation” to minimize the health risks associated with soft drink consumption.
The suit was filed last Wednesday in the U.S. District Court for the Northern District of California on behalf of the non-profit group Praxis Project in collaboration with consumer watchdog group the Center for Science in the Public Interest (CSPI) and the Public Health Advocacy Institute (PHAI), based at Northeastern University in Boston. The suit alleges that Coke and the ABA have violated the Fair Advertising Law by being “engaged in a pattern of deception to confuse the public” and public health officials about the links between regular consumption of sugar-sweetened drinks and health issues like obesity, diabetes and cardiovascular disease.
Furthermore, the suit alleges that Coke and the ABA specifically targeted children in advertising campaigns and that Coke executives knowingly made “material misrepresentations and omissions to the public” in the face of overwhelming scientific consensus about the health risks of frequently consuming sugary drinks.
The suit also claims that Coke and the ABA provided significant funding for scientific “front” groups, such as the Global Energy Balance Network and European Hydration Institute, that “are presented to the public as disinterested research entities but are or were actually Coca-Cola-funded and used…to more effectively misrepresent, suppress, and confuse the facts about sugar-sweetened beverages and their health dangers.”
Based in Oakland, Calif. and Washington, D.C., the Praxis Project’s stated mission is to engage in public health policy advocacy through partnerships with individuals and organizations on a national, regional, state and local level.
In October, The New York Times reported on findings published in the American Journal of Preventive Medicine that found a “pervasive sponsorship” between Coke and PepsiCo and over 100 national health organizations with influence over public policy that received substantial financial support from the two soda giants.
The plaintiffs are seeking a court order that would stop Coke and the ABA from denying the link between sugary drinks and obesity, diabetes and cardiovascular disease. Further action being sought includes ordering the companies to release all their research on sugary beverages, to immediately cease all advertising targeted at children and to fund a corrective public education campaign that would include placing statements about the dangers of sugar consumption on their websites.
In a statement on the group’s website, PHAI executive director Mark Gottlieb sharply criticized Coke’s past public statements equating calories from sugar-sweetened drinks to those from any other sources.
“Coke pays dietitians to tell consumers things like drinking Coke can be a healthy snack and pays scientists to deny that sugary drinks are linked to obesity and then suggests that the main cause of obesity is lack of exercise,” he said. “The hypocrisy of suggesting to consumers that burning calories through laughing can offset the harmful effects of drinking soda is no laughing matter.”
In a statement acknowledging the lawsuit, a Coke spokesperson said that the company takes its “consumers and their health very seriously and have been on a journey to become a more credible and helpful partner in helping consumers manage their sugar consumption,” citing the company’s reformulation efforts to reduce added sugar and promotion of smaller sizes. It also mentioned “transparently disclosing our funding of health and well-being scientific research and partnerships.”
Philadelphia Pushes For Final Soda Tax Resolution
Meanwhile, Philadelphia city attorneys have filed an application asking the Pennsylvania Supreme Court to issue a final decision on the so-called “soda tax,” currently under appeal by the American Beverage Association, this week.
The city passed a 1.5-cent-per-ounce tax on sugar-sweetened beverages in June, 2016, becoming the largest city in the nation to implement such a tariff. The levy, known as the Philadelphia Beverage Tax, is projected to provide around $92 million in annual collections to be directed towards funding pre-K and community schools, as well as a $300 million renovation project for the city’s parks, recreation centers and libraries.
Philadelphia City Hall attorneys argue that the appeals process threatens to disrupt those programs if the tax’s status remains in limbo at the beginning of the next school year in September, when the levy-funded pre-K program is due to expand.
The American Beverage Association spent approximately $10.6 million this year fighting the tax, according to Philadelphia magazine. In December, a Pennsylvania Common Pleas Court judge dismissed a lawsuit filed by the American Beverage Association and local business owners that claimed the tax was unconstitutional.
Wonder-ful Trademark Battle Continues
In other legal news, Whole E Nature, makers of coconut oil-infused “superdrink” Wonder Fuel, filed a complaint last week in California federal court seeking clearance to continue using the “Wonder Fuel” brand name after The Wonderful Company, makers of pomegranate juice brand POM Wonderful, allegedly threatened the company with litigation for trademark infringement.
La Jolla, Calif.-based Whole E Nature is seeking declaratory relief that its products do not visually resemble POM Wonderful and that the companies’ respective names and logos are sufficiently differentiated.
The formal complaint continues a dispute that began last April, when The Wonderful Company sent Whole E Nature a notice demanding an immediate stop to all product sales and warning of potential further legal action over alleged trademark infringement. The complaint alleges that The Wonderful Company has filed opposition papers with the U.S. Patent and Trademark Office for four different marks, including “Wonderful.”
The warning came after Whole E Nature had successfully registered Wonder Fuel as a trademark for “organic ready-to-drink nutritionally fortified beverages” in July, 2015.
According to Whole E Nature, previous requests in August and September 2016 for The Wonderful Company to withdraw their opposition were denied.
The Wonderful Company has been aggressive in protecting its perceived trademarks. In March 2016, the company lost a lawsuit accusing The Coca-Cola Co. of false advertising in the marketing of its Minute Maid brand Pomegranate Blueberry Enhanced Juice. The company has previously pursued similar litigation for trademark infringement against Dairy Queen and Meyer Valley Farms, with varying degrees of success.