Will Recent News Hurt Coca-Cola’s Stock?
T = Trends for a Stock’s Movement
Coca-Cola is a beverage company that engages in the manufacture, marketing, and sale of nonalcoholic beverages worldwide. Its sparkling beverages include carbonated energy drinks, carbonated waters, and flavored waters. The company’s still beverages comprise nonalcoholic beverages like non-carbonated waters, flavored and enhanced waters, non-carbonated energy drinks, juices and juice drinks, ready-to-drink teas and coffees, and sports drinks. Coca-Cola Co. sells its products under the Coca-Cola, Diet Coke, Coca-Cola Light, Coca-Cola Zero, Sprite, Fanta, Minute Maid, Powerade, Aquarius, Dasani, Glacéau Vitaminwater, Georgia, Simply, Del Valle, Ayataka, and I Lohas brand names.
The Coca-Cola Company defended itself in the Supreme Court this week over its advertising of a popular juice under Coca-Cola’s Minute Maid brand. Despite its name, Minute Maid’s Pomegranate Blueberry juice is actually made almost entirely of apple and grape juice, but Coke maintains that it sufficiently informs consumers of the juice’s ingredients by placing on the label that it is a “flavored blend of 5 juices.” The New York Times reported Monday that Justice Anthony M. Kennedy had some virulent questions for Coke lawyers regarding the labeling and marketing of Coke’s juices this week, and he stated that 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.”
According to The New York Times, Pom Wonderful, which sells pomegranate juice, is suing Coke for false advertising, because as lawyer Seth P. Waxman explained, “The evidence shows that over a third of consumers who look at this label believe that pomegranate and blueberry juice, in fact, are the majority juices.” This offends Pom because the company maintains that its products actually contain real pomegranate juice — much more than a teaspoon in a half gallon. Minute Maid’s Pomegranate Blueberry label has pomegranate and blueberries placed in front of an apple and grapes. The juice is also dyed dark purple. However, as The New York Times highlights, the beverage contains only 0.3 percent pomegranate juice and 0.2 percent blueberry juice, and that’s where Pom, along with other Supreme Court justices, see a problem. Kathleen M. Sullivan, a lawyer for Coca-Cola, defended the company’s labeling by asserting that, “We don’t think that consumers are quite as unintelligent as Pom must think they are. They know when something is a flavored blend of five juices and the non predominant juices are just a flavor.” However, Justice Kennedy fired back and said, “Don’t make me feel bad, because I thought that this was pomegranate juice.”