KO: Supreme Court to Decide If Coca-Cola Pomegranate Juice Labels Are Misleading

The drink contains less than 0.5% of the named fruits

   

KO: Supreme Court to Decide If Coca-Cola Pomegranate Juice Labels Are Misleading

On Monday, Coca-Cola (KO) faced open skepticism from two Supreme Court Judges over the validity of its Pomegranate Blueberry Blend of Five Juices labeling.

CocaColaLogo KO: Supreme Court to Decide If Coca Cola Pomegranate Juice Labels Are MisleadingCoca-Cola is battling a lawsuit from Pom Wonderful, which accuses the beverage giant of misleading consumers by using the word Pomegranate in the drink’s label, even though it actually contains only about 0.5% of pomegranate and blueberry juices. About 99% of the Minute Maid-branded drink is made from apple and grape juice, which cost far less than pomegranate or blueberry juice. Pom Wonderful makes juices that contain pomegranate, the Wall Street Journal notes.

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The lawsuit against Coca-Cola was dismissed by a San Francisco appeals court two years ago. That court ruled that Coca-Cola was in compliance with FDA rules governing labeling. Attorneys for Coca-Cola told the Supreme Court that Congress have given the FDA the power to set labeling rules and that the beverage’s label adhered to the rules.

That prompted Justice Anthony Kennedy to ask Coca-Cola’s lawyer if it was the company’s “position that national uniformity consists in labels that cheat the consumers like this one did?”

Justice Samuel Alito chimed in, noting that consumers who purchased a drink with the word pomegranate in the label “would be very surprised” to discover that it contained “less than one-half of 1% pomegranate juice.”

Coca-Cola’s attorney argued that the label was clear enough and that consumers understood that “when something is a favored blend of five juices, the non-predominant juices are just a flavor.”

The Supreme Court is likely to rule on the case in June. KO stock fell slightly in Tuesday morning trading.

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Article printed from InvestorPlace Media, http://investorplace.com/2014/04/ko-supreme-court-decide-coca-cola-pomegranate-juice-labels-misleading/.

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