Judge Rules for Coca-Cola in Pepsi Drink Dispute

August 6, 2009

PepsiCo Inc lost its argument in a dispute over an advertising campaign by Coca-Cola Co which claimed that PepsiCo’s Gatorade sports drink was missing crucial electrolytes, a U.S. judge ruled this week.

In a written ruling on Aug. 4, Manhattan federal court Judge John Koeltl said Stokely Van Camp (SVC), the PepsiCo-controlled company that brought the lawsuit in April “has not shown either a likelihood of irreparable injury or a likelihood of success on the merits.”

In the latest battle between the two iconic companies, Coke launched a sports drink called Powerade ION4 in February, calling it the first formulated to include four electrolytes — sodium, potassium, magnesium and calcium — instead of two (sodium and potassium) “in the average ratio typically lost in perspiration.”

The purveyors of Gatorade, the market-leading sports drink in the United States, sued Coca-Cola and Energy Brands Inc under the U.S. trademark law known as the Lanham Act, citing deceptive acts and unfair competition.

Lawyers for PepsiCo argued before the judge in June for a preliminary injunction to halt the ad campaign. Lawyers for Coke said the campaign was short-lived and over.

“SVC complains about Coca-Cola’s claims regarding the presence of calcium and magnesium in Powerade ION4, but it has made virtually identical claims about calcium and magnesium in its own Gatorade Endurance Formula,” the judge’s ruling said.

“SVC cannot, having jumped on the bandwagon of calcium and magnesium first, now jump off and claim that Coca-Cola must get off too,” the ruling said.

In a statement responding to the ruling, Gatorade spokesman Pete Brace said: “We accomplished what we set out to do. When we filed our lawsuit, Powerade stopped its disparaging claims against Gatorade in its advertising and told the Court it is changing its labeling. That’s why we filed the lawsuit.”

Coca-Cola spokesman Scott Williamson described the decision as “a complete win” for its sports drink.

The case is Stokely-Van Camp, Inc. v. The Coca-Cola Company et al 09-03741 in U.S. District Court for the Southern District of New York (Manhattan) (Reporting by Grant McCool; editing by Carol Bishopric)

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