POM’s Victory Over Coke Throws Open the Gate to More Brand vs. Brand Claims

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The US Supreme Court has just helped bring even greater transparency to food labels and the health claims made on them.

By clearing the way for POM Wonderful to renew its legal battle against Coca-Cola over allegedly misleading labeling of Coke’s Minute Maid Pomegranate-Blueberry juice drink, the court potentially opened the door to greater litigation in a newly robust era of food and beverage brands making claims against competitors that play too fast and loose with the nutritional attributes of rival products.

According to the justices and their 8-0 verdict (Justice Stephen Breyer recused himself), POM can move forward with its false-advertising suit against Coke because there is little actual pomegranate and blueberry juice—only 0.5 percent combined, the court found—in the Minute Maid product that consumers could logically suspect is mostly pomegranate and blueberry juice.[more]

Coke’s practices “allegedly mislead and trick consumers, all to the injury of competitors,” Justice Anthony Kennedy wrote for the court. Earlier, according to the New York Times, Kennedy had said to Coke’s lawyer, if “Coca-Cola stands behind this label as being fair to consumers, then I think you have a very difficult case to make. I think it’s relevant for us to ask whether people are cheated in buying this product.”

While resolving a relatively technical point about harmonizing two federal laws that are involved, the broader impact of the justices’ decision will be to open the floodgates to more inter-brand challenges on nutritional information that the industry previously largely left to federal agencies to regulate.

“Competitors who manufacture or distribute products have detailed knowledge regarding how consumers rely upon certain sales and marketing strategies,” Kennedy wrote. “Their awareness of unfair competition practices may be far more immediate and accurate than that of agency rule makers and regulators.”

Of course, the ruling only allows POM’s action against Coke to proceed; it didn’t resolve the case. POM already has lost jury verdicts in roughly similar disputes with Welch’s, Pepsi and Ocean Spray, Forbes said .

Meanwhile, POM can’t throw too many stones at the glass house of label transparency: It remains the subject of a deceptive-advertising case by the federal government for claiming that its pomegranate juice can treat or prevent heart disease and other illnesses. The FTC’s action is pending at the US Court of Appeals for the D.C. Circuit, according to The Huffington Post.

Could POM Wonderful end up visiting the Supreme Court again?

Image courtesy the Chicago Tribune.

• Connect with Dale on Twitter: @daledbuss

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