Settlement offers injunctive, but not monetary, relief (Coke required to amend labels but consumers won't get any money)

Coca-Cola agrees to settle 'copycat' Vitaminwater deceptive advertising lawsuits, but CSPI still on the warpath

Coca-Cola is not admitting liability but has agreed to settle selected false advertising lawsuits over Vitaminwater in order to avoid the risk and uncertainty of protracted litigation

Coca-Cola has agreed to settle a series of 'copycat' lawsuits accusing it of deceptively marketing Vitaminwater. But the lawsuit that inspired them all - filed by the Center for Science in the Public Interest in 2009 - is still pending, as the CSPI says it wants stronger commitments from Coke.

Coca-Cola - which is currently facing some PR challenges (click HERE) around Vitaminwater following its recent abortive reformulation efforts - has been targeted in a wave of class action lawsuits over the way that it markets the brand ever since it acquired it in 2007.

The first was filed in 2009 by the CSPI (Ackerman ety al v Coca-Cola and Energy Brands, 9-cv-00395), which said Coca-Cola was peddling a product “loaded with sugar” as a healthy alternative to soda.   

Coca-Cola’s motion to dismiss the suit was rejected in mid-2010 by federal judge John Gleeson of the US District Court in Brooklyn, NY, who said the description of Vitaminwater as a ‘vitamin-enhanced water beverage’ and the phrases ‘vitamins + water = all you need’ had “the potential to reinforce a consumer’s mistaken belief that the product is comprised of only vitamins and water” (click HERE).

He also rejected Coca-Cola’s argument that by listing the sugar content of Vitaminwater in the nutrition panel it could not be accused of misleading consumers: “The fact that the.. sugar content of Vitaminwater was accurately stated in an FDA-mandated label… does not eliminate the possibility that reasonable consumers may be misled.”

CSPI: Settlement is not a victory for consumers

This initial success for the plaintiffs prompted a “series of copycat lawsuits” filed in late 2010, which Coke has now agreed to settle, CSPI director of litigation Steve Gardner told FoodNavigator-USA this morning.

But the move was premature, he claimed, netting attorneys $1.2m in fees, but securing nothing meaningful from consumers beyond commitments from Coca-Cola to stop using phrases it has already dropped.

“This is not a victory for consumers. We want Coca-Cola to stop adding vitamins to sugary water. All this settlement has done is delay things procedurally for us, but we’re not going to settle for something like this.”

Coca-Cola will stop using term including ‘vitamins + water = all you need’

In court papers filed on Monday, Coca-Cola said it is not admitting any liability but has agreed to settle a series of cases* filed in Ohio, Illinois, Florida, Missouri and the U.S. Virgin Islands in late 2010 that have recently been consolidated into a multidistrict case in the Eastern District of New York in order to avoid the risk and uncertainty of protracted litigation.

Under the settlement - which is subject to court approval - Coca-Cola has agreed to state the amount of calories per bottle on the front of pack (which it already does) and not to use several claims (which it has already stopped using),  including: ‘vitamins + water = what’s in your hand’; ‘vitamins + water = all you need’; and ‘made for the center for responsible hydration’.

The settlement affects classes of consumers in Ohio, Illinois, Florida, Missouri and the U.S. Virgin Islands who purchased selected Vitaminwater products (excluding Vitaminwater Zero, Vitaminwater 10 and Vitaminwater Energy) between January 2003 and the notice date.

The settlement allocates $1.2m to cover the plaintiffs’ attorneys’ fees and costs and offers injunctive relief (eg. Coke will change its labeling and marketing) but not monetary relief (no cash refunds or vouchers for consumers).

Is Vitaminwater good for you?

Commenting on Vitaminwater last summer, CSPI executive director Michael Jacobson said: "The marketing of vitaminwater will go down in history as one of the boldest and brashest attempts ever to affix a healthy halo to what is essentially a junk food, a non-carbonated soda.”

Coca-Cola responded: “Vitaminwater is a great tasting, hydrating beverage with essential vitamins and water-and labels clearly showing ingredients and calorie content.”

*The lawsuits covered in the settlement are: Cook v The Coca-Cola Co 10-cv-61621 (Florida); Squiabro v The Coca-Cola Co 3:10-cv-118 (the US Virgin Islands); Volz v The Coca-Cola Co 1:10-cv-00879 (Ohio); Bridges v The Coca-Cola Co 13-cv-00644 (Missouri).and Khaleel v The Coca-Cola Co 1:11-cv-00471 (Illinois).

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