Coca-Cola accused of tobacco industry-like deception in lawsuit

Bloomberg

Coca-Cola Co. was sued by activists who compare the beverage giant's advertising tactics to the tobacco industry's past efforts in minimizing the health effects of its products and targeting children to replenish the ranks of its customers.

The nonprofit Praxis Project seeks to stop Coke and the Washington-based American Beverage Association from deceptive advertising of sugary drinks, particularly to children, and for the disclosure of documents related to their impact on health. Studies have linked sugary drinks to obesity, Type 2 diabetes and cardiovascular disease, the group said.

The lawsuit comes as drinks' manufacturers seek to fend off regulatory assaults on multiple fronts. The U.K. is pressing ahead with a tax on sugary drinks over the objections of the producers, following the example of France, Mexico and Hungary. In the U.S., cities including San Francisco and Chicago have also introduced taxes on sweet drinks, citing what they say is a disproportionate impact on residents' health.

Praxis, a California nongovernmental organization, is being represented by the Center for Science in the Public Interest, another nonprofit with a long history of litigation targeting the food and beverage industries.

"From the 1950s until the late 1990s, the tobacco industry engaged in an elaborate campaign of disinformation to cast doubt on the science connecting cigarettes to lung cancer and other diseases," Maia Kats, litigation director for the center, said in a statement.

"Like the tobacco industry, Coca-Cola needs to replenish the ranks of its customers, and it tries to recruit them young," Praxis said in its complaint, filed Wednesday in federal court in Oakland, California.

Coca-Cola didn't have an immediate comment on the lawsuit.

The American Beverage Association hasn't received the complaint, said William Dermody, spokesman for the group. "We can't comment on something we haven't received yet."

For soda giants, the need to be healthier is not new. Per capita soda consumption in the U.S. fell to a three-decade low in 2015, according to Beverage-Digest, a trade publication.

Atlanta-based Coca-Cola and its biggest competitors, PepsiCo and Dr Pepper Snapple Group, have pledged to decrease calories in their beverages and increase healthier options. The companies are responding to both new regulations and consumer demands as drinkers in the U.S. and other developed markets have turned away from sugar and artificial ingredients.

Coca-Cola has promoted smaller package sizes and non-cola drinks. It is relying less on soda, pushing into segments such as ready-to-drink coffee, plant-based protein drinks, cold-press juices and dairy. Coke has 200 reformulations in the works to cut back on sugar, including new versions of Fanta and Sprite already on shelves in the U.K.

PepsiCo, the world's second-largest soft-drink company, announced in October that at least two-thirds of the company's beverage volume will have no more than 100 calories from added sugars per 12-ounce serving by 2025. Dr Pepper Snapple acquired Bai Brands in November for $1.7 billion to expand its portfolio of drinks that are advertised as healthier than soda.

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